Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — SOCIAL SECURITY

Benefits

Mr. Gwilym Roberts: asked the Minister of Social Security what changes have taken place in the real value of social security benefits since they were increased at the beginning of November, 1967; and what plans she now has to safeguard the value of social security payments against the direct and indirect effects of devaluation.

Mr. Barnes: asked the Minister of Social Security if she will now make a statement on the steps she is proposing to take to safeguard the standard of living of low-income families, in view of current price trends.

Mr. Gardner: asked the Minister of Social Security what changes she proposes to make in supplementray benefits to allow for price changes subsequent on devaluation.

Mr. Ridsdale: asked the Minister of Social Security what steps she is taking to help pensioners and others on low incomes who will be most hard hit by recent cuts in Government spending.

Mr. Hugh D. Brown: asked the Minister of Social Security what estimate has been made of the cost of raising supplementary benefits in the autumn as outlined in Command Paper No. 3515.

Mr. Tapsell: asked the Minister of Social Security what steps she proposes to take to protect the poorest families in view of the 2s. increase in the National Insurance stamp, the further 1s. increase proposed, and a rise in food prices since

the decision to increase family allowances by 7s.

The Minister of Social Security (Mrs. Judith Hart): Both National Insurance and supplementary benefits after the increases at the beginning of November, showed an improvement in real value, as measured by the Index of Retail Prices, of about 20 per cent. or more compared with October, 1964. The new rates provide a considerable margin against price increases, which had reduced their value by 1·3 per cent. by mid-December. As to the future, the cost of increasing supplementary benefits must clearly depend upon the amount of the increase. On this, and on other points covered by these Questions, I have nothing to add at present to the statement made by my right hon. Friend the Prime Minister on 16th January.

Mr. Roberts: While we welcome the work done by the Government, in view of the recent sharp price increases, is there not a case for bringing the increase in supplementary benefits forward from the autumn? Will my right hon. Friend remind her colleagues in the Department of Economic Affairs of the need to get something done about prices?

Mrs. Hart: My colleagues in the Department of Economic Affairs are well aware of that last point. On the question of supplementary benefits and the timing of the increase, we shall be watching price developments very carefully, but we have made it clear that the autumn is what we consider to be the correct point at which we should act.

Mr. Barnes: My right hon. Friend gave a specific undertaking on 4th December to low-income families in work as opposed to families on supplementary benefits. In view of the price increases at the present time, should not she implement that undertaking?

Mrs. Hart: I am sure my hon. Friend will realise that, since a 7s. increase in family allowance, which will be kept in full by the families he has in mind, lakes place in April, there is a less immediate degree of urgency.

Mr. Barnes: It does not take account of present price rises.

Mrs. Hart: My hon. Friend is quite wrong. The 7s. increase and the timing


take account of what is happening up to the point at which the increase actually operates.

Mr. Brown: While we welcome my right hon. Friend's assurance, may I ask whether she will consider immediate publication of a leaflet, repeating the assurance given by the Prime Minister, in order to allay the suspicions and apprehensions that may be exploited by political sections in the community? If this were sent to existing beneficiaries, it would be of tremendous help.

Mrs. Hart: I am considering what kind of publicity we should issue in relation to a number of changes due to take place in about April. I am fully seized of the point made by my hon. Friend.

Mr. Ridsdale: While the beneficiaries are thankful for small mercies, may I ask whether the right hon. Lady is aware that they realise that these are very different from the kind of promise given in 1964? Does not she agree that the only way in which pensioners and beneficiaries can really be helped is by the resignation of the Government in order to make way for a Government who will look after their interests properly?

Mrs. Hart: I do not think that many of the hon. Gentleman's older constituents would agree with him on the last point. He cannot have heard my original Answer or he would not make such allegations. I said that the National Insurance benefits and supplementary benefits, as increased in October, represent an increase of 20 per cent. in real value compared with the point at which they stood when the Conservative Government left office.

Lord Balniel: The right hon. Lady is referring to insurance benefits put up before devaluation. Would it not be fairer to the people for the Government simply to explain that they have no intention of protecting the benefits from the impact of devaluation except by increasing the supplementary benefits and that this applies only to people who are out of work and does not apply to low-income families?

Mrs. Hart: Low income families are getting the full 7s. increase. As the Government have made clear, we regard the most urgent need amongst other categories

of the most vulnerable as being those who can best be covered by an increase in supplementary benefits in the autumn. This we have announced. It is a perfectly fair position and we have stated it clearly.

Mrs. Renée Short: What work is being done in the Ministry with a view to exempting low-income families from prescription charges?

Mrs. Hart: The Ministry will be responsible for identifying those families who will get refunds under the same kind of scheme which operated before prescription charges were ended two or three years ago. Although I have made it clear that there are many difficulties, I am considering whether, within the categories for which I am responsible—low-income families, people on supplementary benefits and war pensioners in respect of their war disability—it is possible to work out a system of exemptions rather than of refunds. But there are many difficulties and I cannot pretend that there are easy answers.

Dame Irene Ward: Is the right hon. Lady saying that she made preparation for a rise in prices before devaluation was announced by the Prime Minister?

Mrs. Hart: Price increases have been taking place continually, although to a lesser degree than happened in other recent years. The price increase due to devaluation, as has been said, is estimated to amount to between2½ and 3 per cent. The family allowance increase does not take account of that but of all the other elements in price rises up to the point at which the increase will operate.

Mr. Tapsell: Is the right hon. Lady convinced that her reply adequately satisfies and meets the Prime Minister's pledge that the most vulnerable sections of the community will be fully safeguarded against the effects of devaluation?

Mrs. Hart: I have said that I have nothing to add at present to my right hon. Friend's statement of 16th January and that for the time being the increase in family allowances to take place in April will give tremendous help to low-income families. For example, such a family with two or three children will collect an extra 7s. or 14s. per week in


April, which will be of great help. Beyond that, I have nothing to add to my right hon. Friend's statement.

Insurance Stamps (Impress Method)

Mrs. Knight: asked the Minister of Social Security what plans she has for extending the use of the impress method and monthly system of paying for insurance stamps among smaller firms in industry.

The Joint Parliamentary Secretary to he Ministry of Social Security (Mr. Norman Pentland): Payment of contributions by the impressed stamping method is already available to smaller firms, and my right hon. Friend is proposing shortly to modify the arrangements for payment by this method so that employers will no longer be required to pay in advance for the stamp impression.

Mrs. Knight: Will the hon. Gentleman accept my assurance that his Answer will give much pleasure, because some small firms with only 50 or so employees now pay £100 a week in insurance stamps and will shortly be paying more, which means that small local post offices have to carry enormous stocks of stamps? If lie bears that in mind in any alterations which he may have on the stocks, I am sure that there will be gratitude to him.

Mr. Pentland: The hon. Lady is probably right. The number of employers using this method of impressed stamping rose from 5,569 to 6,047 during the year ending September, 1967, and the change in the arrangements which my right hon. Friend is proposing will probably lead to sill wider use.

Pensions (Payment Overseas)

Mr. Allason: asked the Minister of Social Security whether, in view of Her Majesty's Government's decision to increase Gurkha pensions, she will now increase the retirement pensions of pensioners living overseas who have had their effective pensions reduced as a result of devaluation.

The Joint Parliamentary Secretary to the Ministry of Social Security (Mr. Charles Loughlin): On Gurkha pensions, I would refer the. hon. Member to the reply given to his Question on 23rd January, 1968, by my hon. Friend the Under-Secretary

of State for Defence for the Army. National Insurance retirement pensions are designed to meet the needs of people living in the United Kingdom and they are payable in sterling even if the pensioner is living outside the United Kingdom.

Mr. Allason: While we are all delighted that the Government are at least protecting the Gurkha pensioners from the effect of devaluation, may I ask the Minister again to consider the position of British pensioners living overseas? Does he not agree that if they return to this country, they will be entitled to the pensions increases which they are not now getting and also to health benefits, and would therefore be a very much heavier charge on the Exchequer?

Mr. Loughlin: I want to make it absolutely clear that there has been no change in the procedures for payment to pensioners living outside the United Kingdom in recent years and that this is a long-standing practice. While any question for the Gurkhas is for my hon. Friend the Under-Secretary of State for Defence for the Army, it has to be recognised that their position is not on a par with that of other pensioners, because while pensions are ordinarily expressed in sterling, the Gurkhas' situation is complicated because their pensions are expressed in Indian rupees, and there has been a double devaluation, one of Indian rupees and one of the £. It is a much more complicated matter than the hon. Gentleman suggests.

Netherlands (Reciprocal Agreement)

Mr. Ridsdale: asked the Minister of Social Security how many people have benefited in the last year under the reciprocal agreement on social security between the United Kingdom and the Netherlands; and why David Belsham of the Post Office, Wivenhoe Cross, is not able to claim sickness benefit under this agreement although he contracted poliomyelitis in Holland last year.

Mr. Pentland: Comprehensive figures are not available, but it is estimated that in the year 1967 the number of people who received benefit by virtue of our agreement with the Netherlands was of the order of 700 and that the number of employed persons who remained insured


in the United Kingdom while working in the Netherlands was of the order of 500. The hon. Member's constituent was not entitled to sickness benefit while he was in the Netherlands because he was not covered by any of the exceptions to the general rule that people who are abroad are disqualified for receiving sickness benefit.

Mr. Ridsdale: Is not the hon. Gentle-man aware that my constituent has to have a certificate of incapacity to work, but why is not a Netherlands doctor perfectly capable of giving a certificate of incapacity to work, as is a British doctor?

Mr. Pentland: I am aware of the case which the hon. Gentleman has in mind and I have a good deal of sympathy with it, but our agreement with the Netherlands gives no power to pay sickness benefit in the Netherlands, except where incapacity is certified in this country—and this applies to the hon. Gentleman's constituent—before the insured person goes to the Netherlands.

Mr. Ridsdale: On a point of order. In view of the unsatisfactory nature of that reply, I beg to give notice that I shall raise the matter on the Adjournment.

Widows (Children's Allowances)

Mrs. Lena Jeger: asked the Minister of Social Security whether she will introduce legislation to enable the children of widows to retain their statutory allowance after the remarriage of their mothers; and what estimate she has made of the cost of such a change.

Mr. Loughlin: This suggestion is one of a number which we are considering in the course of our review of the social security provisions. It is estimated that such a change would eventually cost some £4 million a year.

Mrs. Jeger: Is my hon. Friend aware that this review is taking far too long? Does he not agree that there would be some element, not only of social justice but direct relief of poverty, for many of these families if the allowance for the children, which they have by virtue of their own father's contribution to the National Insurance Fund, could be kept?

Mr. Loughlin: It is not quite as simple as my hon. Friend says, because the child becomes a member of the new family when the mother marries. My hon. Friend says that the review is taking too long, but she will recognise that it has to be comprehensive. To some extent we have dealt with certain sections of it, but in this case it would be better to await the outcome of the full review rather than tinker.

Private Schemes and Selective Benefits

Mr. Biffen: asked the Minister of Social Security what proposals she has to encourage the private provision of retirement pensions and other aspects of social security, and at the same time to concentrate public tax-financed social security on those in greatest need.

Mrs. Hart: The part at present played by private provision of retirement pensions and other benefits is being borne in mind in the planning of the new earnings-related pension scheme. Any selective benefits to meet special areas of need, such as we have in the present supplementary benefits scheme, must be provided in the context of a comprehensive system of contributory national insurance.

Mr. Biffen: In view of the restraint which is now promised for public expenditure from the Treasury Bench, would not the right hon. Lady agree that it is very much in the national interest that there should be a rapid and significant rise in the amount of social security which is privately financed?

Mrs. Hart: We have always had it in mind that occupational and private pension schemes had a very important place, and our intention in working out a new earnings-related pension is to enlarge the total provision for retirement and other contingencies and certainly not reduce it. To that extent the hon. Gentleman has the Government's sympathy for what he says.

Mr. Mendelson: Would my right hon. Friend remember with reference to special needs that, in addition to those on pensions, 8 million workers on low incomes will be having the burden particularly concentrated on their shoulders? Will she therefore not proceed with any scheme for prescription charges and any


rebate of them, but reconsider the whole matter so that we have a situation in which the position of lower-paid workers can be carefully considered?

Mrs. Hart: That is not a matter purely for me. As the Government have made very clear throughout our pursuance of the incomes policy, we attach importance to seeing that the lower paid should have every opportunity in any wage agreements which are negotiated to improve their standard of living. This is the basic core of the problem to which my hon. Friend is drawing attention.

War Disability Pensions (Overseas Residents)

Mr. Boyd-Carpenter: asked the Minister of Social Security whether she will now adjust the payments made to war disability pensioners resident overseas so as to restore the value of their Pensions in terms of the local currency of he places in which they reside to the level at which it was prior to the devaluation of the £ sterling.

Mrs. Hart: No, Sir. War pensions are payable abroad in sterling and there is no power to vary them upwards or downwards in accordance with changes in the relative value of the local currency. As he right hon. Gentleman knows, the War Pensioners Welfare Service is there to help any pensioner who may experience hardship.

Mr. Boyd-Carpenter: Is it not appalling that men who suffered injury and mutilation in the service of this country have their pensions reduced in effective terms by 14 per cent.? As the right hon. Lady's own figure of the cost was no more than £750,000. is not this a debt of honour which should have precedent over, for example, the provision of aid to countries which have broken off relations with us?

Mrs. Hart: We are considering here a point which reflects our power to pay in sterling. This is the difficulty. As the right hon. Gentleman knows perfectly well, any war pensioner outside this country who is in real hardship can be helped by the War Pensioners Welfare Service. This is able to help and does help. There is no reason whatever why any war pensioner living abroad should experience hardship as a result of devaluation.

Lord Balniel: Is not the right hon. Lady really quibbling on a technicality? Is there not an issue of public good faith here? Did not these people, resident overseas, come over during the war to serve in our forces and were they not wounded in fighting with our forces on our behalf? Surely we should do something to protect them from having their pensions cut after devaluation by 14 per cent. This is a debt of honour.

Mrs. Hart: The noble Lord is perhaps not familiar with the workings of the War Pensioners Welfare Service. If he were he would know that there are a number of grants which are made to any war pensioner abroad who is suffering real hardship. This is the kind of arrangement which we can and do make in order to be sure that those war pensioners who need protection can have it.

Mr. Boyd-Carpenter: On a point of order. In view of the unsatisfactory nature of that reply, I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest possible opportunity.

Earnings Related Supplements

Mr. Frank Allaun: asked the Minister of Social Security approximately how many people have had their earnings related supplements reduced because, in the previous year, their earnings had been below normal because of sickness or unavoidable absence, thus reducing their supplement later; what representations she has received on this matter; and if she will introduce amending legislation.

Mr. Pentland: The supplement is based on actual earnings in a specified tax year and it is not known in how many cases these are lower than normal because of sickness or other forms of absence. Occasional representations have been made in favour of a more elaborate earnings formula, but my right lion. Friend has no proposal to make in the context of the present interim scheme.

Mr. Allaun: How soon does the Minister intend to change this unfair system, which she has admitted is anomalous?

Mr. Pentland: This has been considered with regard to the planning of our new scheme, and many of the problems that my hon. Friend has in mind


will be taken into account when we are considering the formula for the new scheme.

Old People (Fuel Requirements)

Mr. William Hamilton: asked the Minister of Social Security what steps she is taking to ensure that old people have sufficient fuel in the winter months; and if she will take steps to enable retirement pensioners to acquire quantities of cheap coal from the accumulated stocks now available.

Mrs. Hart: Social security benefit rates were increased at the beginning of the winter and the new rates, together with the long-term addition for supplementary pensioners, as well as the consideration given to special expenses, will ensure that fuel needs are met. I am sure that this is a better approach than seeking to give help in kind.

Mr. Hamilton: Is my right hon. Friend aware that that is not the case, but that a lot of these old people simply cannot afford to buy sufficient fuel to keep themselves warm in the winter months? Does she not think it absured, and almost criminal, that we should have in the region of 30 million tons of coal on the ground, which costs 10s. a ton to put there, while old people are dying of cold?

Mrs. Hart: The latter part of my hon. Friend's question is one more fitted for my right hon. Friend the Minister of Power. I understand that there is some misunderstanding about the coal stocks in question. There is no significant surplus, I gather, of domestic fuel and the undistributed stocks are largely suitable only for power stations and industrial use. I am sure that my hon. Friend is aware of the very great difficulties, and indeed the risk of severe injustice, that can arise if one seeks to give help in kind rather than allowing rates to cover fuel needs. There are certainly arrangements for special fuel needs to be met by the supplementary benefits scheme.

Mr. Fortescue: Would the right hon. Lady accept that those old-age pensioners would much rather have coal suitable for industrial use than no coal at all?

Mrs. Hart: Industrial coal is really incapable of being burned satisfactorily on home fireplaces.

Occupational Pensioners (Unemployment Benefits)

Sir Knox Cunningham: asked the Minister of Social Security if she will introduce legislation to prevent those who, at their own choice, retire from highly-paid posts on pension at the age of 60 years, from drawing tax-free unemployment benefit from public funds before reaching the age at which they qualify for retirement pensions from the State.

Mrs. Hart: The National Insurance Advisory Committee has been examining the question of unemployment benefit and contribution credits for occupational pensioners. I expect to receive its report very soon.

Sir Knox Cunningham: Will the right hon. Lady say how much money from public funds is being spent in this way? In the present economic situation, can we afford it?

Mrs. Hart: I cannot give the hon. and learned Gentleman the figure that he asks for at this moment. I can give it to him later. I am very much concerned about this question and am looking forward to receiving the report, which, as I say, I expect to have very soon indeed.

Sir A. V. Harvey: Would the right hon. Lady bear in mind that I know of two men who have retired from industry and are drawing pensions of over £3,000 a year who will be receiving the dole? Is this not a crazy situation, when we have just heard that old people are short of a bag of coal? We ought not to allow this to continue.

Mrs. Hart: It is for just these reasons that my right hon. Friend who preceded me in my Ministry asked the National Insurance Advisory Committee to look into this problem. It has been looking at it and I am expecting its report. As soon as possible after I have received it, it will be published and one can consider what action is needed.

Mr. William Hamilton: Can my right hon. Friend say whether some of these people when over 65 will be able to get free prescriptions?

Mrs. Hart: They are not over 65. These are people who are prepared to register for employment, and they are mainly between 55 and 65.

Offices, Yorkshire (Hours of Business)

Mr. George Jeger: asked the Minister o f Social Security whether she is aware that many offices of her Department in Yorkshire are open to the public from 10 a.m. to 4 p.m. on Monday to Friday only; and whether she will arrange for them to be open on Saturday mornings to enable working people to get their individual queries attended to without having to take time off from their work.

Mr. Loughlin: These are the standard opening hours for local offices of the Ministry. It is seldom necessary for people in work to visit the Ministry's offices at all. If my hon. Friend knows of any case where hardship has been caused, I will willingly look into it.

Mr. Jeger: Is it not absurd that public service offices, which have to deal with complicated National Insurance matters, should appear to be working only a 30-hour week, and should be closed in working-class districts, where many of the residents do not understand the forms but require a personal interview'? Will the Minister look into this question and see that the offices are open for at least one hour on a Saturday morning for interviews of this kind?

Mr. Loughlin: I should like to dispel any impression that the staff in the offices are working only a 30-hour week. There is a hor of work to be done in the offices apart from counter work. If there is any clear indication that the present opening hours are not adequate to meet the public need, then we ought to look at the matter. We have no evidence which suggests that. There are very few instances indeed where people are inconvenienced by the present opening hours.

Mr. Bob Brown: Would my hon. Friend agree that the staff of his Department, like other people, are entitled to a five-day week? Having said this, would he not further agree that it would be common sense to have one late opening night, say till 6 o'clock, to give industrial workers the opportunity to make inquiries?

Mr. Loughlin: Our experience is that the few people who need to inquire at

the offices in working hours do not have any difficulty. The fact that the offices are open each day in the lunch hour meets this particular problem. If we felt that there was evidence that it was necessary to open on a Saturday we would look at it.

Supplementary Benefits (Payment)

Mr. Winnick: asked the Minister of Social Security if she is satisfied that delays at local branches of her Department which pay out supplementary benefits are kept to the minimum; and what visits are paid to local branches by senior officials of her Department.

Mr. Loughlin: Local offices make every effort to avoid keeping claimants for supplementary benefits waiting any longer than necessary. Frequent visits are paid to local offices by officials from regional offices and headquarters, and for a variety of purposes.

Mr. Winnick: While I appreciate the work done by so many officials and local managers, may I ask my hon. Friend whether he would agree that more should be done to try to cut down unnessary delays? Could something be done as soon as possible to remove the feeling of people who draw supplementary benefit that they are drawing poor relief?

Mr. Loughlin: No one should imagine or be placed in the position of assuming that they are drawing poor relief when they go to the supplementary benefit offices. We try to keep down the delays to the minimum consistent with safeguarding the public purse. Obviously in many cases involving supplementary benefits inquiries and checks have to be made. There are bound to be some delays. But I assure my hon. Friend that our staff do a first-class job throughout the length and breadth of the country with the least inconvenience to those people calling at the offices.

Mr. Frederic Harris: Is the hon. Gentleman aware that it is not so much delay from which people in Croydon are suffering, as was suggested by the hon. Member for Croydon, South (Mr. Winnick), but the lack of a more generous approach in making supplementary grants? If the Minister could give some


guidance on that point to the officials in Croydon, it would be very helpful to those in need.

Mr. Loughlin: That is another question, but I do not know of any evidence which suggests that our officials at the Croydon office are less generous than those in any other office in the country.

Dr. Dunwoody: Has any estimate been made of the extra work which will result at the Ministry's local offices from the reintroduction of prescription charges?

Mr. Loughlin: I have nothing to add to what my right hon. Friend has said this afternoon.

Oral Answers to Questions — TECHNOLOGY

Aerospace Research and Development Establishments

Sir H. Legge-Bourke: asked the Minister of Technology (1) what savings will be obtained in the budget of the Rocket Propulsion Establishment, as a result of the planned cuts in its expenditure during the years 1968–69 and 1969–70;

(2) what savings will be obtained in the budget of the National Gas Turbine Establishment, as a result of the planned cuts in its expenditure during the years 1968–69 and 1969–70.

Mr. Weatherill: asked the Minister of Technology what saving will be obtained in the budget of the Royal Radar Establishment as a result of the planned cuts in its expenditure during the years 1968–69 and 1969–70.

Mr. Emery: asked the Minister of Technology what savings will be obtained in the budget of the Royal Aircraft Establishment as a result of the planned cuts in its expenditure during the years 1968–69 and 1969–70.

Mr. Lane: asked the Minister of Technology what savings will be obtained in the budget of the Signals Research and Development Establishment, as a result of the planned cuts in its expenditure during the years 1968–69 and 1969–70.

The Minister of State, Ministry of Technology (Mr. John Stonehouse): The final

details of the savings to be effected at the aerospace research and development establishments are still being worked out. The savings for the establishments as a whole will be reflected in the Estimates when they are published.

Sir H. Legge-Bourke: Is the hon. Gentleman aware that his reply hardly ties in with paragraph 48 of the Prime Minister's statement on 16th January or with the speech of the Chancellor of the Exchequer the following day when it was indicated that the Departments concerned had been asked to work out in detail what the cuts should be? Are we to understand that nothing has been decided?

Mr. Stonehouse: What I have said is fully consistent with what has already been said in the House. These cuts are being worked out. It would be quite wrong to impose them without having regard to the fullest value which can be attained from our research establishments. This is what we are now doing.

Mr. Lane: Can the hon. Gentleman give no indication at all of some of the major projects covered by these Questions which may have to be deferred?

Mr. Stonehouse: We are awaiting the exact requirements of the Ministry of Defence following the defence cuts. We will work out with the Ministry of Defence what requirements it has, but we hope that the major part of the civil work which we are doing in our establishments will be maintained.

Mr. Frank Allaun: Is it not true that half the country's scientific research will still be devoted to military ends, and that many Labour Members of Parliament want far bigger cuts to be made in this direction so that this scientific brain power can be devoted to productive purposes?

Mr. Stonehouse: I cannot agree with my hon. Friend's percentages. In fact, we are increasing the amount of money spent on civil research in relation to defence research expenditure.

Sir H. Legge-Bourke: The hon. Gentleman will be aware that in paragraph 48 of the Prime Minister's statement on 16th January it was indicated


that there would be a cut of approximately £13 million in this current financial year. Would the hon. Gentleman say how this is to be related to the repeated insistence by the Minister of Technology that we should encourage a European ethnological community, bearing in mind:he importance of E.S.R.O. and E.L.D.O. n dealing with rockets?

Mr. Stonehouse: My right hon. Friend is at Strasbourg today emphasising this important theme, and certainly we shall have this very much in mind in the work we will be doing in our establishments. A very significant cut will be announced, and there will be staff reductions as well, but we want the valuable long-term work of our establishments to be retained.

Oral Answers to Questions — MINISTRY OF LABOUR

Selective Employment Tax

Mr. Dance: asked the Minister of Labour on what grounds the wholesale slaughtering of animals is regarded as a distributive trade for the purposes of Selective Employment Tax.

The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley): The activity is so classified in the standard industrial classification, which was adopted as the basis of Selective Employment Tax classification.

Mr. Dance: Is not the hon. Gentleman aware that municipal slaughterhouses do not pay the Selective Employment Tax? Surely it is most unjust that a firm which is doing identically the same work should he charged the tax.

Mr. Hattersley: I am aware that the position is as the hon. Gentleman has described it. As to the justice or injustice of the situation, I fear that he must await the review of classifications which I promised to the House some weeks ago.

Mr. R. Carr: Cannot the hon. Gentleman give the House a closer idea about when the results of the review will be announced? It has been promised in general terms for a long time.

Mr. Hattersley: I accept that it has been promised for some time, and I accept equally the necessity to make a

statement to the House at the first opportunity. But our obligation is to make sure that when the review is announced it is comprehensive and right. I hope that we can do those things in the near future.

Guaranteed Working Week

Mr. Macdonald: asked the Minister of Labour what progress has been made in negotiations for a guaranteed working week; at what stage before Section 3(1) of the National Insurance Act comes into operation will the Government implement their undertaking to review these negotiations; and what contingency preparations have been made for legislation on this subject.

Mr. Hattersley: At the end of last year my right hon. Friend reviewed the progress made in these negotiations and decided that legislation would be necessary. He is consulting industry about the details.

Mr. Macdonald: Is my hon. Friend aware that his reply will create some satisfaction, but that there is a great deal of anxiety among those trade unions which fear that the negotiations may not be successful? Can he state when the promised legislation is likely to come forward?

Mr. Hattersley: Questions about the timing of the legislation are for my right hon. Friend the Leader of the House. However, I hope that my hon. Friend is reassured by the knowledge that we understand perfectly well that the legislation must be passed and operative by March, 1969. I gladly give that reassurance to the House.

Oral Answers to Questions — HOUSE OF COMMONS

Oral Answers to Questions

Mr. Boyd-Carpenter: asked the Lord President of the Council when he intends to bring forward his proposals for amendments to Standing Orders to extend the time allotted for oral answers to Parliamentary Questions.

The Lord President of the Council and Leader of the House of Commons (Mr. Richard Crossman): I have no proposals to put before the House on this subject.

Mr. Boyd-Carpenter: The right hon. Gentleman will recall that during the procedure debates in November he indicated that he had under consideration some improvements in our arrangements for Parliamentary Questions. Is it not perfectly clear that with the number of Questions that there are today there is sufficient time neither for oral Questions to be answered nor for adequate supplementary questions?

Mr. Crossman: When we discussed this matter previously, I was thinking, to some extent, in relation to morning sittings. I think that we are doing quite well at Question Time. We are getting through more Questions than we used to do. I am not at present convinced that we should change the situation, but more evidence might be available later.

Mr. William Hamilton: Would my right hon. Friend consider again the possibility of having more oral Questions in the mornings, including Friday mornings, and limiting the number of oral Questions which Members can ask even when they are not here?

Mr. Crossman: I am prepared to consider all these things. We recently made a great many changes in our procedure. We might see how the new ones work.

Captain W. Elliot: Would not the right hon. Gentleman agree that he is saving a great deal of time on the Floor of the House by such actions as sending the Finance Bill upstairs? Should not the question of extra provision of time for Questions be considered?

Mr. Crossman: As I say, I am prepared to consider all these things and to see how our new timetable works. But we should not make hasty decisions on this matter.

Mr. Emrys Hughes: As my right hon. Friend is considering the matter of Questions, may I ask him whether he is prepared to examine sympathetically having Scottish Questions put and answered in the Scottish Grand Committee, say, once a fortnight?

Mr. Crossman: As I have often told hon. Members, I am always willing to consider anything, but whether I would act on that is a very different question.

Newly Emerging Countries (Parliamentary Gifts)

Mr. John Wells: asked the Lord President of the Council if he will refrain from moving resolutions to give Parliamentary gifts to newly emerging countries, in view of the fact that over one fifth of the recent recipients of these gifts no longer have Parliamentary government, and instead if he will seek to establish a small fund from which suitable tokens of Parliamentary esteem may be given to countries, which respect Parliamentary democracy on national anniversaries and at similar times, without formal resolution.

Mr. Crossman: No, Sir.

Mr. Wells: Could the right hon. Gentleman consider the second part of my Question more closely, even if he can do nothing about the first part? As he and the House will be aware, it was most unfortunate that at the 50 years' independence celebrations of Finland hon. Members had to put their hands into their own pockets to make a modest contribution because there was no fund available for a presentation?

Mr. Crossman: The particular question the hon. Member raises is a difficult one. It might set a precedent to say we would give gifts to anybody inside and outside the Commonwealth for every kind of celebration. His proposal would, I think, require legislation. But I will give it my most careful consideration.

Select Committees' Reports (Debates)

Mr. William Hamilton: asked the Lord President of the Council if he will arrange the provision of an additional four days per Session for debates on reports from Select Committees of the House.

Mr. Crossman: I prefer to deal with this on a case by case basis.

Mr. Hamilton: Does my right hon. Friend recognise that the present situation is very unfair? The Select Committees and Specialist Committees are


working very hard producing Reports which are neither debated nor dealt with in any other way in this House. Will he not get down to the problem and see what can be done to provide more time for debates on them?

Mr. Crossman: Certainly this is a matter we have to consider, but one has also to consider that when a Specialist Committee reports we have to await the reply of the Department. That applies to the Specialist Committee on Science and Technology, which is the major Report we have yet to debate. I am determined we shall have it debated. However, I do not think we should proceed to treat this as an en bloc idea; each Report should be considered on its merits.

Mr. Hogg: As I read the original Question it referred to Select Committees rather than to Specialist Committees. Will the right hon. Gentleman, in considering the matter on a case by case basis, bear in mind the Select Committee on Privileges of this House?

Mr. Crossman: Indeed I will, and I think we must have it debated, but when I suggested it for early debate the right hon. and learned Gentleman, very properly, said that he wanted more time to discuss it, and so I will give him a little more time.

Mrs. Renée Short: Is the right hon. Gentleman aware that the Estimates Committee has produced four or five Reports which have received Departmental replies? Would he consider giving time for them, notably the one published list August about prisons?

Mr. Crossman: Yes. I have it very much under active consideration and hope to make a statement in the near future.

Mr. Lubbock: Does the right hon. Gentleman not realise how unsatisfacory it is for the nuclear reactor industry in this country not to have decisions made on its future? Does he not see the dangers of the Americans getting ahead of us in nuclear technology, such as for high temperature reactors, while these decisions are depending on the Ministry of Technology? Will he use his influence to see that this debate will also be at the earliest possible moment?

Mr. Crossman: Not, I think, at the earliest possible moment, because, as I have explained to the hon. Member, the Report of the Committee was a very serious and considered document, and I think he will agree that we really should have our debate on the basis of the Report and the White Paper in reply. It has taken some weeks to appear, but I can give the hon. Member the assurance that I will not allow my right hon. Friend a moment longer than he needs to produce a really good Report, and then we can have a first-rate debate.

Catering

Sir Knox Cunningham: asked the Lord President of the Council why, apart from specific requirements, the Refreshment Department of the House of Commons buys all its wines through shippers from France; and if he will return to the former policy of providing Commonwealth and South African wines at moderate prices for the use of Members and their guests in the dining rooms of the House.

Mr. Maxwell: I have been asked to reply.
No, Sir. We will not return to the former practice of buying wines through multiple shippers.
All wines are bought through one shipper, since in this way we have liberated some £10,000 in capital and are able to purchase on very favourable terms.
Commonwealth wines may at present be purchased only by special order, but the Catering Sub-Committee are currently considering the purchasing of Australian wines.

Sir Knox Cunningham: But does that Answer mean that as a matter of policy there will be no wines from South Africa—[HON. MEMBERS: "No"]—and does it really mean—[HON. MEMBERS: "From Cyprus?"]—that whether we can buy Cyprus or South African or other Commonwealth wines—[An HON.
MEMBER: "Russian vodka?"]—or Russian vodka, will depend on the political views of the Kitchen Committee?

Mr. Maxwell: No. The purchase of wines is not determined on questions of politics. It is a question of demand. We do have demand for Australian wines, and


we are looking into it. If there should be demand for Australian or Cyprus or Russian wines we will——

Sir Knox Cunningham: And South African?

Mr. Maxwell: —or South African—we will look into it.

Mr. Biggs-Davison: Is it not gratifying that the hon. Member for Buckingham (Mr. Maxwell) has said what he has said about there being no disposition to discriminate on political grounds, because would it not be extremely unfortunate if the British House of Commons were known to be discriminating against products from the Commonwealth preference area?

Mr. Maxwell: We do not propose to differentiate on a political basis between what goods we in the Department buy. We buy in the best possible market to get the best possible produce for hon. Members and their guests, and the staff.

Oral Answers to Questions — MINISTRY OF HEALTH

Old People's Homes and Hostels

Mr. Tapsell: asked the Minister of Health what effects the economy measures announced on 16th January will have on local authority building programmes for the provision of old people's homes and hostels under Part III of the National Assistance Act, 1948.

The Parliamentary Secretary to the Ministry of Health (Mr. Julian Snow): Though the building of these homes and hostels will necessarily proceed at a rather lower rate than we had hoped, we expect a substantial programme to continue.

Mr. Tapsell: In view of the fact that both the Prime Minister and the Minister of Health have given an assurance that there is to be no cut or slow-down in the hospital building programme, should not this policy, as a matter of both logic and social justice. be applied also to old people's homes?

Mr. Snow: I do not think that we are doing badly, and we hope to provide in due course a much bigger programme; but in case the hon. Member is suffering from what is called Schadenfreude, I must tell him that the programme for the present year, allowing for adjustment of

prices, will be more than the £11 million odd in the last year when the party opposite was responsible.

Mr. Dean: Now that the hon. Gentleman has specifically said that there is to be a cut in the planned programme, can he say when local authorities will know which projects will be cut, because of the state of uncertainty which exists at the moment?

Mr. Snow: Estimated loan sanction will be more or less the same figure as last year. As to the programme which we shall authorise, I should tell the House that my right hon. Friend is to ask the local authorities to tell him which are the projects they would wish to proceed with in present circumstances and then he will issue loan sanction within the limits based on the principles enunciated by the Prime Minister.

Oral Answers to Questions — HOUSING

Building Costs

Mr. Biffen: asked the Minister of Housing and Local Government to what extent devaluation and the accompanying measures designed to divert productive resources from domestic to exporting activities is expected to affect the cost to house building and the total numbers of houses likely to be built during the corning year, in the light of the latest available evidence in the movement of prices.

The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Arthur Skeffington): In the public sector costs will rise on this account by between ½ and 1½ per cent. according to the type of construction. The rise may be somewhat greater in the private sector because of the increase in Bank Rate. Tender and selling prices need not move with costs if there are compensating economies, for example on design. I expect well over 400,000 houses to be completed this year in Great Britain.

Mr. Biffen: In view of the increased costs to which the hon. Gentleman has referred, is it not clear that this must have some consequence on the level of rents which will be charged? May we, therefore, have a guarantee from the Government that there will be no attempt to frustrate the working of a market


rent policy by councils or private land, lords by virtue of a reference to the National Board for Prices and Incomes?

Mr. Skeffington: The Answer which I have given to the hon. Gentleman is the best estimate which can be made at the present time, and far from attempting to frustrate the measures which the Government have passed, obviously they want to carry them out.

Mr. Frederic Harris: Surely this is a severe extra cost which will, unfortunately, with other burdens, find its way into additional rates in the forthcoming year, will it not?

Mr. Skeffington: I think it is hardly likely to affect the figures in the Answer I have given the House.

Mr. Lane: Can the hon. Gentleman give us an estimate yet of what totals will be completed in 1969 and 1970?

Mr. Skeffington: Not at this stage, but I will endeavour to do so if that question is put down.

Oral Answers to Questions — TRANSPORT

Public Transport (Assistance)

Mr. Geoffrey Wilson: asked the Minister of Transport what estimate she has made of the expenditure on new forms of assistance to public transport, provided for in the Transport Bill in 1968–69 and in 1969–70: and what percentage cut is being made in each case.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Morris): As stated by my right hon. Friend the Prime Minister on 16th January, this expenditure is being limited to £10 million in 1968–69 and £20 million in 1969–70. This represents a cut of 16⅔ per cent. and 20 per cent., respectively.

Mr. Wilson: Does not the Minister think that that is too much?

Mr. Morris: This is the considered view of my right hon. Friend, and I am sure that this will be advantageous to the working out of the Bill which we are now discussing.

Mr. Maxwell: In arriving at these cuts, are the rural bus services being

treated better than, for example, the rail services, particularly having regard to the railway closures in constituencies such as mine? Is he aware that the rural bus services in some areas are so abominable that if additional financial cuts are imposed on them life will be made almost impossible and intolerable?

Mr. Morris: I am aware of the concern that is felt by my hon. Friend about this matter. As he will be aware, in the course of our discussing the Bill we are taking steps to implement the longawaited Jack Report on Rural Transport.

Mr. Speaker: Are there any more supplementary questions? If not, and if the Minister is here, we will proceed to the Private Notice Question.

QUESTIONS TO MINISTERS

Mr. Maclennan: On a point of order. It has been obvious to the House, Mr. Speaker, that at least a dozen hon. Members have been absent from their places during Question Time. In consequence of this, Ministers have been brought to the House unnecessarily. They have had to sit in their places for upwards of an hour while waiting for Questions to be asked. This is a most undesirable practice and I seek your guidance about how this situation might be rectified.

Mr. Speaker: I am grateful to the hon. Gentleman for raising that point of order, remembering that it is very rare for the Chair to be so grateful. However, it is not within the power of the Chair to insist that hon. Members be in their places to ask Questions.

Mr. John Wells: Further to the point of order. Are you aware, Mr. Speaker, that it is not infrequent for hon. Members who are seeking factual information to put a starred Question when they require an early Answer?

Mr. Speaker: I apologise to the hon. Member. Will he repeat his point of order?

Mr. John Wells: I was pointing out that an hon. Member may from time to time seek information—statistics and so on—and, in an effort to obtain an Answer on a particular day, he may put down


a starred Question. Surely this is perfectly in order, if the hon. Member wishes to obtain a prompt Written Answer.

Mr. Speaker: I am not sure that the House would agree with the hon. Member. I would say that the purpose of an Oral Question, rather than a Written one, is to enable the hon. Member to put an oral supplementary. I suggest that that is its main purpose.

Sir S. McAdden: Further to the point of order. While I of course support your ruling, Mr. Speaker, all hon. Members will, I am sure, support the view that nothing should be done to deprive an hon. Member of his right to put down a Question, even if he is unfortunately prevented from being present to ask that Question. However, will you consider the apprehension which exists about the number of Questions which are put down by, and the non-appearance of, the hon. Member for West Ham, North (Mr. Arthur Lewis), which is causing some concern?

Mr. Speaker: If an hon. Member intends to make an. adverse comment about another hon. Member, it is usual for him to give that other hon. Member advance notice of the fact.

Mr. Kenneth Lewis: Further to the point of order. Can you explain, Mr. Speaker, why Questions Nos. 48 and 49 are down to the Prime Minister today and why the right hon. Gentleman is not here to answer them? I came to the House especially, it never having occurred to me that the Prime Minister normally answers Questions on a Monday. Has there been a change in the order of answering?

Mr. Speaker: There has been no change in the rules of order. I am interested to know why the hon. Gentleman came to the House today.

HULL TRAWLER "ST. ROMANUS"

Mr. McNamara: Mr. McNamara (by Private Notice) asked the President of the Board of Trade if he will make a statement on the reported disappearance of the Hull trawler "St. Romanus".

The Minister of State, Board of Trade (Mr. J. P. W. Mallalien): The trawler

"St. Romanus" left Hull with a crew of 20 on 10th January for the Norwegian fishing grounds. Sea and air search operations were mounted on 26th January at the request of the owners and are continuing from the coast of Norway to Iceland. I am keeping in close touch with events and am awaiting the results of the search before considering what further action should be taken.

Mr. McNamara: While thanking my hon. Friend for that reply, may I ask him if he is aware of the concern that is felt in Hull that we might be facing our second great fishing tragedy in just over a year? I am sure that the whole House will join with me in expressing sympathy to the people who are greatly worried over this matter in my constituency and in the city of Hull.
While hope is to some extent sinking fast, will my hon. Friend immediately inquire into the following matters? First, why was there delay in reporting the May Day distress signal of 12th January? Secondly, why did not that arrive until last week? Thirdly, why was the question of the life raft, which was discovered on 13th January, not reported until Friday of last week? Fourthly, why did it take 10 days to discover that an alleged message from the ship had, in fact, come from another ship? Fifthly, will he explain why the alarm was not raised earlier in Hull in view of the fact that the last report was on 10th January, it being customary to make daily reports in one way or another? Sixthly, is he aware——

Mr. Speaker: Order. I know the deep sympathy which the hon. Member feels about this grave problem, but questions must be fairly brief.

Mr. McNamara: This industry has suffered a tremendous number of fatalities, probably the largest number in the country. Will my hon. Friend inquire into whether it is correct that wireless operators had refused to serve in this ship, and even though the skipper had a supplementary ticket, it would be impossible to fight for the safety of the ship and at the same time send out May Day messages?

Mr. Mallalieu: I, too, wish to express my sympathy for the families who are going through this anxious period. My


hon. Friend has asked a series of very important questions, and I assure him that I am already inquiring into them. If it turns out that this fishing boat is, unhappily, lost, we will, of course, have a preliminary inquiry and in the light of that decide whether a formal investigation is necessary.

Mr. Fletcher-Cooke: I hope that the hon. Member for Kingston-upon-Hull, North (Mr. McNamara) will accept, on behalf of his constituents, the sympathy of my hon. Friends for those who are suffering the agony of indecision in this matter.
Is the Minister of State aware that there seems to have been incredible delay in this matter; that the last news we heard of this vessel was on 10th January and that we are now almost at the end of January? Does it not seem extraordinary, in these days of radar and efficient telecommunications, that we should have known nothing about this? Is he aware that there are strong rumours that there was no wireless operator aboard this vessel, which again seems extraordinary in these days? Will he consider instituting an inquiry at the very moment that the vessel is presumed missing because those concerned—not only financially but, more important, humanaly—about the crew are living in a state of great distress at present and should not be left in this position any longer?

Mr. Mallalieu: I entirely accept the hon, and learned Gentleman's comment that the length of time it has taken to report this matter is extraordinary. We will certainly have an investigation the moment we are unhappily forced to presume that the vessel is lost.
As for his remarks about the presence or absence of a radio operator, I, too, have heard these, and I am checking them up. I understand that it is true that there was no radio operator aboard. However, it is fairly normal for the skipper to assume such duties; but I am inquiring into the matter.

Mr. Ogden: Does the Minister agree that communications from ship to ship and ship to shore are absolutely essential? Does he further agree that nothing that has been said in the House today and nothing within his knowledge can

be said to be critical of the radio officers who serve our merchant ships?

Mr. Mallalieu: Good communications are, of course, essential, but unhappily radios break down sometimes, and that may have happened in this case.

Captain Elliot: Is there an organisation which keeps track of these vessels and receives periodical reports from them? If not, or if such organisation as exists is not adequate, will he consider setting up a satisfactory organisation to undertake this task?

Mr. Mallalieu: The Board of Trade sent out a circular about 18 months ago requesting that these vessels should report their positions daily; and that has normally been done.

Mr. Ellis: Would not my hon. Friend agree that the House is right to be perturbed about the undue length of time during which no communications of any kind were established with the ship? Will he go into this angle very quickly and ascertain that it is not happening with other trawlers and with other ships?

Mr. Mallalieu: I think that the House is perfectly right to be critical, but I do not want to prejudice matters. I want to ascertain the facts.

Sir A. V. Harvey: As the relatives of other trawler crews are also concerned with communications, will the Minister undertake to make a statement to the House or to the Press at an early date on what communications are between vessels and base?

Mr. Mallalieu: Indeed, I will.

BUSINESS OF THE HOUSE (SUPPLY)

Ordered,
That this day Business other than the Business of Supply may be taken before Ten o'clock and, in the case of the Question which under the provisions of paragraph (6) of Standing Order No. 18 (Business of Supply) Mr. Speaker is directed to put forthwith at Ten o'clock, he shall this day put such Question forthwith so soon as the House has entered upon the Business of Supply.—[Mr. Grey.]

CIVIL AVIATION BILL [Lords]

Bill referred to a Second Reading Committee.—[Mr. Grey.]

Orders of the Day — SUPPLY

[8TH ALLOTTED DAY],—considered.

Orders of the Day — CIVIL AND DEFENCE ESTIMATES, SUPPLEMENTARY ESTIMATES, 1967–68

Question,

That a Supplementary sum, not exceeding £351,701,000, be granted to Her Majesty out of the Consolidated Fund, to defray the charge which will come in course of payment during the year ending on the 31st day of March 1968 for services included in the following Supplementary Estimates, viz.:—



£


Class I, Vote 8, Inland Revenue
2,334,000


Class II, Vote I, Diplomatic Service
2,896,000


Class II, Vote 2, Foreign Services
2,567,000


Class II, Vote 4, Commonwealth Services (Revised sum)
8,348,000


Class III, Vote 5, Police, England and Wales (Revised sum)
10,483,000


Class IV, Vote 2, Transport Boards (Revised sum)
30,000,000


Class IV, Vote 5, Roads, etc., Scotland
4,000,000


Class IV, Vote 6, Roads, etc., Wales
4,150,000


Class IV, Vote 11, Board of Trade (Promotion of Trade, Exports, etc., and Shipping and Certain Other Services)
9,000,000


Class IV, Vote 13, Investment Grants (Revised sum)
89,000,000


Class IV, Vote 16, Industrial Reorganisation Corporation
5,000,000


Class IV, Vote 17, Ministry of Power
3,968,000


Class IV, Vote 18, Ministry of Technology
2,600,000


Class V, Vote 4, Department of Agriculture and Fisheries for Scotland (Agricultural Grants and Subsidies)
2,465,000


Class V, Vote 7, Ministry of Agriculture, Fisheries and Food (Agricultural and Food Services) (Revised sum)
32,062,000


Class VI, Vote 7, Rate Support Grants to Local Revenues, England and Wales
22,605,000






£


Class VI, Vote 11, National Health Service, etc. (Hospital Services, etc.), England and Wales (Revised sum)
22,740,000


Class VI, Vote 15, National Health Service, etc., Scotland. 
3,953,000


Class VI, Vote 18, National Insurance (Revised sum)
16,200,000


Class VI, Vote 19, Family Allowances
8,500,000


Class VI, Vote 20, Non-Contributory Benefits
3,000,000


Class VI, Vote 21, War Pensions, etc.
5,500.000


Class IX, Vote 1, Ministry of Public Building and Works
3,000,000


Class IX, Vote 2, Public Buildings, etc., United Kingdom (Revised sum)
7,150,000


Class IX, Vote 4. Works and Buildings for the Ministry of Defence (Navy Department)
3,500.000


Class IX, Vote 5, Works and Buildings for the Ministry of Defence (Army Department)
8,000.000


Class IX, Vote 6, Works and Buildings for the Ministry of Defence (Air Force Department)
1,750,000


Class XI, Vote 1, Broadcasting
6,500,000


Defence (Central) Supplementary Estimate, 1967–68
2,340.000


Defence (Navy) Supplementary Estimate, 1967–68.
10,000,000


Defence (Army) Supplementary Estimate, 1967–68
18,000,000


Total
£351,701,000

—put forthwith, pursuant to Order, and agreed to.

Bill ordered to be brought in upon the Resolution by the Chairman of Ways and Means, the Chancellor of the Exchequer, and Mr. Harold Lever.

Orders of the Day — CONSOLIDATED FUND

Bill to apply a sum out of the Consolidated Fund to the service of the year ending on 31st March, 1968, presented accordingly and read the First time; to be read a Second time Tomorrow and to be printed. [Bill 66.]

Orders of the Day — GROWTH OF BUREAUCRACY

3.33 p.m.

Mr. Geoffrey Rippon: I beg to move,
That this House deplores the continued growth of bureaucracy and the failure of Her Majesty's Government to announce in their Statement on Public Expenditure, Command Paper No. 3515, clear proposals to streamline the machinery of Government and so reduce the numbers employed in the public service.
The most urgent task facing Parliament today is to curb the power of central Government and close the ever-widening gap between Whitehall and our constituents. In the last three years, we have seen an apparently uncontrollable growth in the numbers of public servants. Whereas between 1951 and 1964 the number of non-industrial civil servants, excluding the Post Office, fell by 11,000, in the three years between October, 1964, and October, 1967, the numbers rose by no fewer than 54,000. This is an increase in the hard core of administrative bureaucracy and represents a rise of about 13 per cent.
The Financial Secretary to the Treasury told us on 23rd January that, in the year 1968–69, a further increase of 11,000 had been anticipated at a cost of £12 million. However, as we know, the Prime Minister, in his statement on public expenditure, on 18th January, promised that Government Departments would so plan their staffing that over the year 1968–69 there would be no further net increase in the number of civil servants as a whole. This, he said, was estimated to save £15 million. Of course, that is not a real saving but just a reduction in planned increased expenditure, and, as we know, there is no limit to that sort of saving.
The truth is that the increase in the number of public servants is merely a sympton and not the cause of the growth of bureaucracy and the over-government from which we are now suffering.
When the House debated simplification of Government and reduction in taxation, on 9th June last, on a Private Member's Motion, the then Financial Secretary to the Treasury—who has, I think, been called back into service today—said:
I also have not time to answer the charges made in connection with the expansion and

growth of the Civil Service since we have been in power.
Very fortunately for him!
That is, of course, directly the outcome of the decisions about policies that we have made. If people want the Civil Service to be reduced it can only be by the abolition or reduction of some of these policies."—[OFFICIAL REPORT, 9th June, 1967; Vol. 747, c. 1535.]
He was quite right. So I hope that today we shall hear from the Government what policies are to be abandoned or modified in order to hold the number of civil servants at even the present inflated level.
But we have to go further than that. It is futile, in our present economic situation, to talk of the saving of a mere £15 million of future extravagance. We must abandon or modify the disastrous policies that are now choking the machinery of central Government and imposing an absolutely intolerable burden on our citizens and industry.
The growth of the Civil Service is only the beginning of the story. The Government's policies have generated an increase of 11 per cent, in local authority administrative staff—that is, excluding altogether teachers, industrial staff and the like. They tie down an absolutely incalculable number of people in productive industry who have to deal with a mass of new legislation, new taxes, new controls, new regulations and new forms. The Prime Minister told us on 20th July, 1966, in one of his regular crisis statements:
What is needed is a shakeout which will release the nation's manpower, skilled and unskilled, and lead to a more purposive use of labour for the sake of increasing exports and giving effect to other national priorities."—[OFFICIAL REPORT, 20th July, 1966; Vol. 732, c. 628.] That statement must apply, above all, to the public sector, because the great spendthrifts of money and manpower are the Government.
The public sector—local authorities, central Government, public corporations—spend about 45 per cent, of our gross national product, and now employ nearly 6 million people, or nearly 23 per cent, of all those in employment. It is fairly clear that the major fields for reduction in public expenditure lie in policy changes to reduce the size, scope and functions of Government——

Mr. J. J. Mendelson: As the reimposition of prescription charges


will require more personnel, will not the right hon. and learned Gentleman agree with out request that the Government should not proceed with that reimposition?

Mr. Rippon: I will come later to the question of cost benefit, but there, I think, the cost benefit to the country is very clear.

Sir Charles Taylor: On a point of order, Mr. Deputy Speaker. As this is virtually a censure Motion on the Government, may I suggest that we should adjourn the House until the Prime Minister and the Leader of the House are here?

Mr. Deputy Speaker (Sir Eric Fletcher): The hon. Member knows perfectly well that that is not a point of order.

Sir C. Taylor: With the greatest respect, Mr. Deputy Speaker, on many occasions in the past the House has asked for the Prime Minister and the Leader of the House to be present.

Mr. Deputy Speaker: That does not involve any point of order. Mr. Rippon.

Mr. Rippon: It is, of course, a vote of censure on the Government. I am not surprised that not many Members of the Government are present. They dare not be here; they have no answer to the charges against them. Their only hope is to keep away from this House and the criticisms we have to level against them.
The evils of bureaucracy, and in particular its tendency to arbitrariness and inflexibility, do not spring from any sinister desire on the part of the officials themselves. It is the system with which we have shackled ourselves and for which Parliament itself is responsible that is the root of the mischief. It is Parliament itself which should be calling these Ministers to account, not only hon. Members on this side of the House.
When the Fulton Committee publishes its findings, we may have much to comment on questions of recruitment, organisation and management of the Civil Service, but the really deep-seated evils lie outside the scope of the terms of

reference of that or any other Committee, because both the quantity and quality of public administration stem from Government policy. If, as to-day, we have a weak, indecisive, vacillating Cabinet, the quality of administration right down the line will be bad. If, as today, we have a never-ending cascade of legislation creating new State controls, naturally enough there is a record rise in the number of public servants to administer it. It must be emphasised that our criticism is not against the public service official, but against the Government and the system which those officials are forced to operate.
As a first task, the machinery of government must be drastically overhauled and streamlined. We should start at the top. We now have the largest Government—the largest absent Government—in the world. The number of Ministers in the House of Commons has risen by over 30 per cent, under the present Prime Minister. We have too many Ministers, too many Departments, and too much overlapping among them all. The Leader of the House, in his television discussion, on 19th January, made the most damaging indictment of the Government that I have yet heard. I told the right hon. Gentleman that I would refer to him. I have heard from his office that he cannot be present. He thinks he has more important duties to perform than to answer to this House for the actions of his Government.
The right hon. Gentleman complained in his broadcast about the difficulties of making decisions. Of course, all experience shows that huge and diffuse administrative organisations are almost always bad for making clear, quick, sensible decisions. That applies to this Government as much as to any organisation. We have over 100 Ministers. All of them have to be kept active, not apparently here, but in shuffling, one presumes, from one Cabinet committee to another, always discussing but never deciding. The Leader of the House says that they find great difficulty in deciding. This is only good for civil servants, who love to keep their Ministers on the march while they play their own sophisticated version of the Whitehall war, fighting for their Departments and battling with the Treasury. This is according to the Leader of the House on television last week.
We should not only cut down the number of Departments—getting rid, for example, of useless Departments such as the Department of Economic Affairs and the Department of Overseas Aid, which could be merged with the Commonwealth Office—but also a large number of unnecessary Ministers, including—the list is by no means exhaustive—the First Secretary of State, the Secretary of State for Economic Affairs and the Minister for Overseas Development, with all their minions. A co-ordinator has been described as a man with a desk between two expediters. We now have more coordinators than expediters.
The right hon. Member for Sowerby (Mr. Houghton) told the House on 9th June last year
'no co-ordinating Minister in the Government can co-ordinate … because of the several and separate responsibilities of Ministers of the Crown who claim to have a degree of responsibility for their Departments, both to the Government and Parliament, which makes effective co-ordination almost impossible."—[OFFICIAL REPORT, 9th June, 1967; Vol. 747, c. 15, 17 and 18.]
He told us that, under the present Administration, even to appoint the See-bohm Committee required a conference of at least four senior Ministers to agree on its composition because four Government Departments had a finger in the pie.
As the hon. Member for Coventry, North (Mr. Edelman) said, in an article published in the Daily Express, on 20th February, last year:
The effect of large Governments is to create large Departments … the cost of government today is in direct ratio to the number of Ministers.
The hon. Member asked in his article:
Can Harold Wilson cut the cost of government with, say a third reduction in his Ministerial team? Every consideration of efficiency and economy argues that he should.
It is only the consideration of power that argues that he cannot. As the hon. Member put it so succinctly:
Let 100 Ministers bloom and the Premier has 100 buddies.
And, by heavens, that is about all he has got. Even with the tremendous increase in the number both of senior and junior Ministers, the Leader of the House has publicly deplored the fact—I think I quoted him almost verbatim—that the ordinary departmental Minister is over-

whelmed by an appalling mass of detail. Why do they not learn how to delegate? What do they do with the Army of Ministers of State and Parliamentary Secretaries? What are they doing now? They are not here to be answerable to us. What is the point of having no fewer than six Ministers taking part in the Committee stage of the Transport Bill?
It could be argued that the average departmental Minister does better to have just one Parliamentary Secretary to act as a real deputy Minister. All that happens with so many junior Ministers is that the files are shuffled hopelessly from one Department to another and they find it even more difficult to make decisions. A number of junior Ministers are being used as second-class civil servants. They should be kept out of the administrative side and should concentrate on Parliamentary and Ministerial duties. Their Ministerial duties are to make decisions. We can confirm what the Leader of the House said about their difficulty in doing that. He complained of too much centralisation of decision making.
Let us, therefore, have fewer Departments and fewer Ministers and give them more responsibility.
Many would agree that the curse of our present system is that the citizen is left to deal, not with an individual official, but with a vast, unseen, impersonal and intangible machine. A comparatively simple problem or decision involves an infinity of form-filling and correspondence, not only with a number of Departments but with sections of each Department. The confusion is both lateral and vertical. If at some stage there is negotiation with an identifiable official fairly high up the line, as likely as not, as the Leader of the House said, the official will be removed before the negotiation can be completed.
It is not enough, of course, to streamline the machinery of government and to break down the number of decisionmaking levels and so to have fewer people working more effectively. The real trouble is that many of the decisions now attempted to be made in Whitehall should never be made there at all. In so far as they need to be made within the executive machine, they should be made at regional or local level. For this purpose, we should delegate far greater powers to the local authorities.
I do not think we can afford to wait for the Report of the Royal Commission and any subsequent legislation in order to make a start. Such delegation must be both real and effective. Nothing is achieved by the proliferation under this Government of advisory committees such as the regional economic planning councils. They are just the creatures of Whitehall and manifestly impotent. That was clearly demonstrated by the South-Eastern Economic Planning Council over the whole wretched Stansted affair. The Stansted affair is one of the worst examples in modern times of a bureaucracy run mad.
Nor is it any good setting up so-called regional port authorities, as is now proposed in the Transport Bill, on an arbitrary, meaningless and powerless basis, instead of giving, as the shipping industry and everybody else asks, real freedom to individual ports and estuarial authorities. We need to see a fundamental change in the attitude of the central Government towards local government. We must reverse the trend of recent legislation to reduce local discretion and convert local authorities into mere agents of Ministers and Whitehall.
It is the result of Government action and Government policy and legislation that, according to Ministry of Labour figures, employment by local authorities increased by a staggering 253,270 in the last three years to 2,216,815, or almost 10 per cent, of the working population.

Mr. Stanley Orme: A Conservative Government would make it more.

Mr. Rippon: That is the wrong point. The present over-centralisation of government necessitates the employment of more people in local government, not to deal with services, but to deal with central government and all the requirements imposed by it upon local government. What we should do is set about implementing the recommendations of the Maud Committee on the Management of Local Government, which was set up by my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph). As Maud said:
The whole complex of central administrative control needs to be revised, reduced and simplified.

The Committee recommended that central financial control should be limited to
local programmes of capital investment, but this control should no longer be used to prescribe the details of local buildings or expenditure.
It does not affect Britain's total economy one iota whether or not the Hexham Urban District Council is allowed to build a swimming bath or whether some local authority wants to do some minor works which are entirely within its competence.
We should have avoided the folly of a Land Commission, which is really only duplicating functions that local authorities either have or could be given, and which to date has required £2½ million to meet its administrative costs, including the annual salaries of 1,500 staff.
On the other hand, there are decisions for which the Government machine, nationally and locally, has assumed responsibility that are not the proper function of any Department or any public authority. Detailed decisions as to what should be done in every sector of industry are increasingly being transferred away from those in business and on the spot to officials in Whitehall and elsewhere. As Sir Paul Chambers has put it:
In so far as the State intervenes to stop fraud, misrepresentation, unfair practices, restriction of trade and abuse of monopoly power"—
he might have added "other than their own"—
it should be supported. In so far as it endeavours to make central decisions which for efficiency should be made in each enterprise itself, such intervention increases bureaucracy, reduces productivity, and is inconsistent with a parliamentary democracy as we understand it".
The British Civil Service has many virtues. The quality of its minutes and the level of its intelligence has always rightly been highly praised, but it is totally unaccustomed to intervening in business; and, on the whole, experience has shown that in almost every case its interventions have been disastrous in then-effect.
I would add a note of caution about Sir Paul Chamber's acceptance that the State has a duty to regulate by legislation the conduct of business in order to stop fraud, misrepresentation and unfair practices. It is possible, often for


the best of motives, to carry the protection of the public to self-defeating ends and to succeed merely in bringing the law into disrepute. I think that this may be true of certain of the provisions of the new Companies Act, which throw needlessly onerous burdens on many small businesses.
It is certainly true, for example, of the new Labelling of Food Regulations which are issued in the name of consumer protection. They are complex, and implementing them will be costly. The bitterest criticisms relate to the proposals which specify the sizes in which product names, ingredients, and minor ingredients should be printed in relation to each other. According to the Food Manufacturers' Federation, 75 per cent, of all food labels will need to be redesigned in the next three years. It is estimated that this will cost £2 million, or perhaps twice that amount. Even the director of the body which is most concerned with protecting the public in this held—the Consumer Council—has said that she thought that the Minister's proposal went too far in specifying—one needs to read this rather slowly—that the smallest letter on a packet should be not less than a quarter the size of the largest.
That is just bureaucratic madness and it is the sort of example which I am sure many of my right hon. and hon. Friends and many hon. Members opposite could duplicate. I am not surprised that my right hon. Friend the Member for Sevenoaks (Sir J. Rodgers) said last week that he knew of no other country in the world which had thought it necessary to have a restriction of this kind. We are to assume that a housewife can be expected to vote, but not to buy a can of baked beans, without the assistance of the Government. That is the kind of bureaucratic folly into which this Government are leading us. That is one side of the picture.
On the other hand, where the Government really have a responsibility and duty in relation to the management and control of national finance and public expenditure, they are failing miserably. The one aspect of Government organisation that only the Prime Minister and the Cabinet can deal with is their own method of financial control and cost effectiveness. On the evidence of the

Leader of the House in the television programme to which I have already referred, the Treasury is now so constituted that Ministers are more concerned with the dominant struggle of the Treasury with everyone else than with almost any other matter. In the words of the Leader of the House, it is the Treasury which collects the information and makes the policy. He wants to separate the two functions.
It is not merely as an ex-Departmental Cabinet Minister that I, too, share some anxieties about the frustration and folly of concentrating so much decision-making in the Treasury, though I would never go so far in any criticisms I made as the Leader of the House, went on 19th January.
On the other hand, many civil servants themselves are, once they are released from servitude, a little critical of the way in which things are managed. Lord Bridges, in his book on "The Treasury", said that he was troubled about two things. Both of them, I think, are relevant to our deliberations today. He said this:
The first is the degree of frustration and wasted time which is inevitable when any really large organisation, such as the Government service, is subject to detailed rules and regulations administered centrally without sufficient scope for local interpretation.
Secondly, by the conviction, based on most of a working lifetime, that the Treasury does its best work when it has the strength of mind to keep up the big issues and avoid being drawn into the byeways, however intellectually satisfying they may be. Indeed, I have come to believe that there is something inconsistent—psychological inconsistent—in both looking to Departments to exercise financial prudence and forethought in framing their policies and consulting the Treasury betimes on their policies in the formative stage, and at the same time calling on Departments to submit considerable detail to the Treasury when executing agreed policies.
Just as that applies between Departments, it applies also as between the central Government and local authorities.
Obviously, judging by what the Leader of the House said on television, there has been some deterioration since Lord Bridges wrote his book. I certainly do not go as far as another distinguished former civil servant, Mr. Max Nicholson, who in his recent book "The System" went almost as far as to suggest that we might abolish the Treasury altogether.


However, I believe that some of Mr. Nicholson's criticisms are fully justified and that we should create a system in which Departments have much greater degree of control over their own budgets and in which at least some degree of Treasury supremacy is broken down.
Whatever criticisms may be made of the Treasury and its place in the administrative machine, I believe that the savage allegations of the Leader of the House were totally unjustified and only succeeded in highlighting the failure of the Government. He complained—and complained publicly—that the British Government were the worst-informed Government in the world. That is the responsibility of the Government, not of the Treasury. I am sure that it was not the Treasury that induced the Prime Minister to go on television and tell the British public that after devaluation a £ in their pocket was still worth the same amount. On that basis we are certainly the worst-informed public in the world. But then, if the Prime Minister had been the captain of the "Titanic", he would simply have told the passengers that he had stopped to pick up ice.
If the Leader of the House says that the Government do not know what they are doing, why do not the Government do something about it? The Leader of the House says that he would like to see the collection and assessment of intelligence in a completely separate department. Then why not set it up? Meanwhile, the worst-informed Government in the world have been calling continually for more statistics. They would do better to rely upon trade associations to supply many of the statistics. As it is, industry is being made to supply the same figures to a whole number of different departments at the same time. Then, on the Government's own evidence, they do not know what to do with the information. What a terrible comment on the waste of manpower involved in the collection of information required to inform the worst-informed Government in the world.
The Prime Minister and the Government should take the advice of my right hon. Friend the Leader of the Opposition and should set up alongside the Prime Minister's own office a Department on Cost Effectiveness with power to turn Whitehall upside down. The main purpose

of such a Department would be to ensure that each individual Government Department carried out its own cost reduction programme for which the Minister himself would be responsible, and ensure the use of the most modern management techniques. Many of those techniques have rather formidable transatlantic descriptions, such as "value engineering," "refine requirements," "condensed documentation"—I rather like that one; the efficiency of a Government Department might well be judged by the reduction in the weight of paper that it consumes each year—and "critical path analysis."
All these have resulted in handsome savings wherever they have been applied. As a result of using these techniques, the total audited savings made by the United States Defence Department in 1965 amounted to £1,650 million. It was calculated that the same percentage savings in our then public expenditure of £8,000 million would be £400 million.
To cut away the jargon, it means that the only way to achieve really effective savings in public expenditure without undermining services would be by every major project being subjected to searching scrutiny in terms of cost and benefits. That, of course, would apply to prescription charges to which hon. Member for Penistone (Mr. Mendelson) has referred. Sensible management also requires that manpower as well as money should be brought into the picture, as we did under the Conservative Government, when the Ministry of Public Building and Works had a very different status in relation to the Cabinet and the Treasury and when we jointly worked out a public investment programme in terms of manpower and materials as well as finance, and regionally as well as nationally.
We would find it a salutary exercise if every new Bill brought before the House had a manpower as well as a financial memorandum. We ought certainly to have one for the Transport Bill which, quite apart from all its other evils, will cause administrative chaos in the Ministry of Transport and in industry.
If we had had a manpower memorandum, even those on the benches opposite might have thought a little harder about some of the consequences of the Finance


Bills which the Government have introduced. Quite apart from our views on the present record levels of taxation, it is impossible to defend the excessive complications that the Government have introduced into our tax system, which have contributed as much as anything to the growth of bureaucracy, and the disillusion, confusion and waning confidence of the finance and business world whose energies and manpower would have been better employed in increasing productivity and exports.
The iniquitous Selective Employment Tax, which is collected by one Ministry and repaid by seven others, required 380 extra civil servants simply to deal with refunds of premiums. This tax has already resulted in 1,200 appeals, so I am informed. to the Industrial Courts.
Even conceding the somewhat dubious principle of the Capital Gains Tax, its frightful complexity drove Inland Revenue staff to such desperation that.they stopped working on it until they were paid £50 extra to compensate them or mastering the underlying theory and structure, and all for a yield in 1965–66 of £4 million and an estimated yield in 1966–67 of £7 million.
Altogether, between 1964 and 1967 the number of full-time staff in the Inland Revenue increased by nearly 5,000. Thus, roughly one in 10 of all the extra civil servants employed since 1964 is needed to collect more taxes. Even more striking 900,000 hours of overtime had to be worked by the Inland Revenue in the six months to September, 1967. The imagination boggles at the corresponding expenditure on manpower required for the industries and citizens with whose affairs they are dealing.

Mr. Eldon Griffiths: Is my right hon. and learned Friend aware that we have now achieved something of a record in this respect, in that we now employ more civil servants to collect taxes from 50 million British than the Americans employ to collect taxes from 200 million Americans?

Mr. Rippon: I am not surprised to hear it Even if one allowed for the difference between Federal revenue and State revenue in the United States, there is little to justify the increase in tax staff on the scale that we have seen in the last three years.
Almost the worst scandal has been the replacement of the straightforward Conservative investment allowances, which were administered through the tax system, by investment grants administered through the Board of Trade. These investment grants are cumbrous to administer and uncertain, and are wrongly dependent upon Ministerial discretion. Each grant must be checked against a list of conditions 36 pages long. No wonder applicants' auditors are required to certificate every claim. No wonder, as the Sunday Times reported on 21st January, the Board of Trade apparently requires 1,100 staff spread over five regional offices to administer the grants. Even with all these additional officials, industry is still arguing, two years after the publication of the White Paper, about what sort of thing ought to be in, and what ought not to be. On any test of cost effectiveness, that cannot possibly make sense.
Perhaps our greatest danger in the House today lies in the fact that mismanagement on such a massive scale is alienating the elector from Parliament as well as from the Government themselves. The citizen feels that we have got ourselves bogged down in irrelevant detail and are failing to provide him with what he is entitled to, and that is effective protection against the Executive. I am sure we all find this in our constituencies. There is a growing and dangerous belief that Parliamentary institutions and the rule of law have been tried and have failed, that what we really want are some sort of Whitehall despots—Ministers or officials, expert, scientific and commercial—who can run the country like a business. That is a very dangerous line of thought. I do not want a streamlined machinery of government which will be an instrument for the exercise of power by—admittedly—a new Prime Minister with perhaps the Leader of the House, Sir Paul Chambers, Lord Robens and Sir William Armstrong. [Interruption.] Indeed, David Frost might be added as well. He would be rather better than some of the people who were put up against him.
What we have to do is to reassert the supremacy of Parliament over machinery of government. The right hon. Gentleman the Member for Sowerby, having had experience of this Administration


from the inside, suggested on 9th June last year that perhaps we need a new Haldane Committee. I would rather we considered taking matters into our own hands in a rather more direct fashion. In the present system of Parliamentary accountability, through the Public Accounts Committee and the Select Committee on Estimates, it is only possible to discover mistakes in concept and administration long after they happen, and when the report appears, the Government say, "Oh, yes; we have found out all about it, and we have now put it right".
The appointment of the Select Committee on the Nationalised Industries was, admittedly, a step in the right direction, but it is not enough. I remind the House that, just after the end of the war, the then Select Committee on National Expenditure proposed that there should be a Select Committee of the House of Commons, appointed sessionally under Standing Orders, with a permanent assessor, an officer of the House, for the collection and presentation of data, to maintain a continuous review of the machinery of Government, with special reference to the economic use of personnel. Such a Select Committee on the public service, buttressed, perhaps, by a Select Committee on administrative law, would give us a far more effective means of performing our inherent constitutional responsibilities.
Too many people, when they talk about reform of Parliament, want us to streamline our procedures so that we can pass more legislation at the whim of the Executive. But, on the contrary, we should be devising procedures and so organising ourselves as to make it more difficult. It is significant that, although our Sessions have lengthened considerably and much more of our work is done in Standing Committees, the time given to Estimates, or Supply as such, has halved since 1908. Instead, we spend our time with a whole mass of ill digested and bad legislation. When Members of Parliament appear on television or radio to be asked about the laws they pass, they have no idea. It is hard enough to follow any one Bill in which one happens to be interested, but to suggest that the ordinary Member of Parliament today has any idea of the nature of the legislation he is

responsible for imposing on the country is absurd.
The statutes for the year 1912—I am sure our Liberal friends will agree that that was the time of a great reforming Administration—filled no more than 146 pages. Now, we run at nearly 2,000 pages a year, and that is quite apart from the almost equally thick volumes of Statutory Instruments. The Transport Bill, with 260 pages, is almost twice as long as all the legislation, including the Finance Act, passed in 1912, and we have now no fewer than 10 Standing Committees upstairs churning through this rubbish.
We really must get our own priorities right in this House in controlling the growth of Government, the growth of public expenditure and the growth of bureaucracy. Because the Government have so signally failed to do these things, we wish to censure them today in the strongest possible terms.

4.13 p.m.

The Financial Secretary to the Treasury (Mr. Harold Lever): I welcome the prospect of this debate because, not being a violently party partisan personality myself, I had hoped that we would be enriched by some carefully thought out and well considered criticisms by the Opposition on the rôle and structure of the Civil Service and Government. [HON. MEMBERS: "Hear, hear."] I am glad that there seems to be general satisfaction, at least on the opposite side of the House, that those expectations of mine have been fulfilled. I do not begrudge the right hon. and learned Member for Hexham (Mr. Rippon) his fun. It was all good, clean Victorian fun, perhaps better addressed to a Motion to streamline the Lord President of the Council than to streamline the structure of Government—but no less amusing, if less instructive, on that account.
Speaking as the Financial Secretary—and one who has for all too brief a period been in this office, which traditionally imposes a special responsibility in relation to the Civil Service—I am disappointed that I have not heard any well thought out criticisms of the structure of Government. I have heard a great many meaningless and empty generalisations, and a great many undocumented thoughts well tailored to general prejudice but bearing little relation to the current need


for a thoughtful appraisal of the structure and rôle of modern Government and of the Civil Service. [Interruption.] I did not catch the hon. Gentleman's intervention, but I am very happy to let him make it more explicitly.

Mr. John Biggs-Davison: If the hon. Gentleman wishes to hear it, my intervention was that he was reading his criticism of my right hon. and learned Friend's speech, and his reply must have been written before he had heard the speech.

Mr. Lever: The hon. Gentleman is mistaken. My habit of demurely dropping my eyes in the face of so much ribald criticism should not lead him to suppose that what I have just said is included in my notes. Unlike many occupants of this place who have been similarly challenged, I should be very happy to provide the notes for his inspection after the debate is over.
I was truly disappointed because, since Victorian times there has been a long tradition—in which the right hon. and learned Gentleman respectably and reputable finds himself—in the House and outside, including on the music halls, of regarding the Civil Service as an unfortunate excrescence on society.

Mr. Rippon: That is not my point at all.

Mr. Lever: Am I being unfair? I am glad that the right hon. and learned Gentleman does not say that. But there has certainly been a long tradition of regarding the Civil Service as a group of men taken from a position of creative and constructive work to processes of unnecessary form-filling and the like. I think that the right hon. and learned Gentleman's speech today reflected a good deal of that Victorian prejudice.

Mr. Rippon: No.

Mr. Lever: If the right hon. Gentleman feels that I have done an injustice to his speech, he will have to correct it as best he may. My reaction to his speech was that, basically, it was a hangover of the antiquated and irrelevant prejudices of a bygone age in relation to the Civil Service, which took as its basic underlying assumption that society has a vested interest in reducing the Civil Service and, further, that it is self-evident that, if the

Civil Service increases in size, this is something which is, prima facie, repulsive and, prima facie, reflects discredit upon the Government concerned.

Mr. Ripon: Quite right.

Mr. Lever: The right hon. and learned Gentleman says, "Quite right". That is exactly my complaint about his speech. I shall try to show that it is quite wrong to make any such inference from an increase in the Civil Service.

Sir Arthur Vere Harvey: The hon. Gentleman ought to bring himself up to date. He is usually abreast of affairs. He talks about the Civil Service being mocked. For months now, in Parliament and in the Press, people have been mocking and "taking the mickey" out of the Prime Minister and his Government, leaving the Civil Service entirely alone.

Mr. Lever: If it be strictly relevant to this debate to deal with the mockery in the Press of the Prime Minister and this Government, I shall refer to it, but primarily I wish to complain that the right hon. and learned Gentleman, although he disavows it, has taken the basically Victorian misconception that it is self-evident that an increase in the Civil Service reflects discredit upon the Government. If that was not the whole tone of his speech, then I failed to take it on board.
The first point made by the right hon. and learned Gentleman and hon. Members opposite——

Captain Walter Elliot: Captain Walter Elliot (Carshalton) rose——

Mr. Lever: Let me finish my sentence. I shall then give way. I would like to think that, when right hon. and hon. Members opposite disavow the point which I have made and repudiate my criticism, they are disavowing rather than fostering the pathetic popular prejudice that any increase in the Civil Service is something to be deplored and, on the face of it, is evidence of Government incompetence and mismanagement.

Captain Elliot: The hon. Gentleman has obviously come with a written speech in answer to my right hon. and learned Friend. My right hon. and learned Friend said nothing of the sort.

Mr. Lever: Forgive me. If the hon. and gallant Gentleman has nothing better to contribute than a repetition of a criticism which has already been made and answered, he should not trespass upon the courtesy which I offer in giving way.
Hon. Members opposite are now, apparently, saying that it is the increase in the number of Ministers which is automatically evidence of mischief and incompetence on the part of the Government. As I understand it—and I want to be quite clear—the right hon. and learned Gentleman and his hon. Friends do not join in the popular and ignorant clamour that an increase in the size of the Civil Service of itself indicates incompetence or wastefulness by the Government.

Sir Douglas Glover: I believe that the Government's present policies have created too fast a growth in the Civil Service, far faster than the growth of our national productivity. That is a serious criticism of the Government.

Mr. Lever: The hon. Gentleman is as candid as ever, and does not flinch from my criticism. My point is that the growth in the Civil Service, as a long-term secular trend, is absolutely inevitable in any modern society.

Mr. Percy Grieve: Does the hon. Gentleman really suggest that a rise of 52,000 over a period of three years is a reasonable increase in the size of the non-industrial Civil Service?

Mr. Lever: Indeed, I do. [HON. MEMBERS: "Oh."] I am trying to show the House the general background of government that makes it inevitable, notwithstanding the clamour of the ignorant, that the Civil Service will increase under whichever Government are in power.

Mr. Rippon: The Prime Minister has told us that its size will not increase, but it was going to increase by 11,000 next year. What will be stopped? What policies will be abandoned or reduced to bring that about?

Mr. Lever: I must ask the right hon. and learned Gentleman and his hon. Friends to restrain their impatience, though not because there is any matter that will not be dealt with. The right

hon. and learned Gentleman must not join in the attempt to make my speech a series of intermittent responses to what are, at the time they are made, irrelevant questions. But, out of courtesy to him, as he is leading for the Opposition, I will immediately answer the points he raised.
When I said that there is a long-term secular trend in any modern society to growth in the Civil Service, that does not mean that it will grow in any given year. I am talking about the inevitable trend of society. The right hon. and learned Gentleman also wants me to deal with the question of what policies will be sacrificed, but I must leave that to the part of my speech where I shall be dealing with that subject.
I must now make some progress with my main theme, which is to put the debate in its proper perspective. Modern society causes the Civil Service to increase inevitably for broadly three reasons. First, any modern society tends to move in the direction of reducing the number of people engaged in manual and physical labour and increasing those in white-collar, administrative and organisational labour.
Second, as society becomes more affluent it tends, having satisfied its basic needs, to make a greater demand on services. In the nature of things, many of those services can be supplied by private enterprise, but equally, in the nature of things, many of the services needed by a society usual in enriching itself and becoming more affluent and exacting in its standards can be achieved only by an increase in the public administration. So, for example, as we become better off and have never had it so good, whether under a Conservative or a Labour Administration, private enterprise keeps supplying more laundry services, restaurant services, and Bingo. But we must rely on public enterprise to meet the growing appetite of an increasingly affluent and discriminating society for other services like education, land and amenity planning, greater safety on the roads and matters of that kind.
Unless the Tory Party wishes to make itself the last repository of out-of-date and irrelevant prejudice it might as well admit that, if we envisage a growing and modernising society, it automatically follows


that there must be an increase in the public services as well as in private service industries. Any other view is as stupid as it is doctrinaire. The idea that the only services a society increasing in affluence and taste should demand are those provided by private enterprise, and none of those involved in an expansion of the public services, is so puerile that it is hardly worth discussing. The Tory Party has, in practice, implemented all the policies which I am describing, and I shall return to that point.
The third reason why the more modern a society becomes the more public services there must be is that increasingly in a modern society it is accepted that the rôle of Government includes an overall responsibility for the broad general out-turn of the nation's economic effort. That is a fairly recent development which, oddly enough, started to occur under a Tory Government. In repudiating the inevitable growth of such public services hon. Members opposite are, in a sense, repudiating the more constructive aspects of their own political past.
Happily, the Tories are better in Government than they are in Opposition. I do not say that the inference to be drawn from that is too rapidly to put them back into Government. Obviously, a more protracted period in training as Opposition is required so that they have further qualifications for that job. As I have said before about the Tory Party, it is not power that corrupts but the absence of power which turns it into an Irresponsible group, repudiating all that was most constructive in its achievements in Government.

Mr. J. E. B. Hill: If we accept that we are better in Government than in Opposition, will the hon. Gentleman accept the converse, that Labour is better in Opposition than in Government?

Mr. Lever: Even if I did, for the same reason as I thought that the Opposition should make up their deficiency as an Opposition by a protracted spell in that rôle, I suppose that the same remedy would apply to any defects that we have.
We see that there are three reasons why the public service must be expected to increase. First, to satisfy the evergrowing demand for services in areas where satisfaction can be achieved only

on the basis of public organisation, such as better roads, better amenities, better public health services, and better public educational services. All those things cannot come into being on an increased scale without an increase in the public administration.
Second, we must expect an increase in Government to discharge the now accepted Governmental responsibility for the overall out-turn of the economy.
Third, we must expect an increase of Government because administration is part of the infrastructure of a modern economy. The more modern the economy, the more it must depend on the infrastructure provided by the Government. I see heads shaking on the benches opposite, but that is an elementary fact that hon. Members opposite must come to terms with. Private enterprise can supply most of the ancillary services for primitive industry, but as industry becomes more complex and technical, in whichever country and under whichever political regime, the infrastructure of Government activity to enable it to be successfully undertaken must be greater. Private enterprise could provide the transport services for the enterprise of the last century in the form of railways, river transport or canals, but when one moves to massive road or air services one must establish a vast administration of public intervention to provide the infrastructure.

Mr. Rippon: We know all this.

Mr. Lever: I am grateful to the right hon. Gentleman opposite, who says that he knows all this. It follows, therefore, that we should expect the size of Government administration to increase with the advance of technology of society. This is inevitable, and it meets the needs of that society both industrially and socially.
If the size of the Civil Service causes distress at any point, one is entitled to say that a certain function placed upon the Civil Service for a particular area of work could be performed with less staff. It is all right saying that in general terms, but the right hon. Gentleman and his hon. Friends have to descend to particulars.

Mr. Rippon: I am sorry to interrupt the hon. Gentleman again. I referred


specifically to the recommendations of the Maud Committee for reorganising the relationship between central and local government. That is a specific suggestion. Why do the Government not implement that Report?

Mr. Lever: The Government have a Royal Commission sitting on this question.

Mr. Rippon: They have had one.

Mr. Lever: Let me just say this. It is no part of my burden today——

Mr. Rippon: To defend the Government.

Mr. Lever: —to make the suggestion that the Government are in a state of final and immaculate perfection in all their deeds and achievements. Very possibly there are areas where we ought to move faster. Nobody denies this. But what is objectionable is to feed the outside public with suggestions that civil servants are a bloated bureaucracy performing no useful function or airly to suggest that the desirable functions of this bureaucracy could be achieved by the simple process of cutting down the numbers allocated to undertake the job.

Mr. Cranley Onslow: The Government should change their policies.

Mr. Lever: The hon. Gentleman calls out that we ought to change our policies. We must be told which policies. We have been told of one policy, that in relation to tax.

Mr. Rippon: Other policies are the changing relations with the Treasury and the establishment of a cost-effectiveness department.

Mr. Lever: Yes. tax, changing relations with the Treasury, cost-effectiveness and so on. These are mere unserviceable mouthings unless they are related directly to concrete matters that the Government can bring into effect. The inference that the right hon. Gentleman expects us and public opinion to make must be that the Government are totally unconcerned or the Civil Service is totally unconcerned——

Mr. Rippon: The Government.

Mr. Lever: The Government and the Civil Service.

Mr. Rippon: The Government.

Mr. Lever: The Civil Service is in part responsible for being a watchdog of its own methods and efficiency. It has an organisation and methods department. It is constantly evolving technical improvements in the administration of the work allotted to it. The Government take full responsibility for assigning policies to the Civil Service, and it is clear that the more policies we assign the more civil servants will be required. But any talk of cost efficiency and the like is not the task of the Government. It is undertaken continuously in the Civil Service. [Interruption.] It is, of course, for Parliament to check that the work is undertaken, and it is for the Government to make sure that it is undertaken and done. But does the right hon. Gentleman assert that there is something defective in the policies of cost effectiveness? If so, he should tell us which Department and where we should act and where the evidence is to support the allegation. Otherwise it remains an empty generalisation of no service to the House or to me.

Mr. Rippon: I gave a very long list.

Mr. Lever: It remains an empty generalisation of no service to the House and of no service to me, who am very anxious to take on board any valid and useful criticism that is offered from whatever quarter to improve the administration and efficiency of the services for which I have some special responsibility.
The Government have set up the Fulton Committee to advise on the structure of the Civil Service and the Government. It is clear that many important recommendations about the structure of the Civil Service are likely to emerge. The Government have taken by no means a negative attitude towards the Committee, nor has the Civil Service. The Civil Service is anxious to help its own modernisation and to help to improve the structure of Government. It is plain—I do not conceal it—that if the Government are going to intervene more frequently in business, we have an obligation—I agree with the right hon. Gentleman—to be more businesslike about it. I should like to acquit the right hon. Gentleman of the charge of feeding prejudice


by characteristic remarks about the interventions of civil servants—he must read them in his own speech—and about what are the consequences of civil servants intervening in business. Many civil servants who have intervened in business have shown exceptional judgment, skill and creative capacity in those interventions.
One of the conclusions that I have come to during the short space of time that I have been in the Government is that since we intervene so frequently in business and since we necessarily have a Civil Service as our executive arm, it becomes imperative that civil servants must have very much closer acquaintance with and experience of business than has been the case in the past. I welcome very much the exchange of views and the tendency to draw people in the Civil Service from business and also the interchange between the Civil Service and business that is taking place. Otherwise we are liable to have highly talented and knowledgeable civil servants with a very virginal quality when dealing with businessmen, which does not always produce the most rewarding results.
The business of decision-making in Government will have to be looked at. I think that there are too many interdepartmental committees and too much tendency to spawn paper. This is not something new occurring under the present Government. It has been hap-pending for a considerable period of time. We ought to look at these things and try to adopt modern methods of reducing paper work. This involves the House in facing another matter, and that is some reduction in accountability. The basis on which the Civil Service has worked in the past has been that the most meticulous accounts and records should be available on almost everything that it does.
In most modern businesses the conclusion has been reached that one has to weigh the cost of the accountability and accounting methods against what one hopes to achieve by them, and sometimes the system of accounting is far more costly than any risks of loss involved in a lesser scrutiny or recording system. I would tentatively support the view that this is the case inside the Civil Service, not only in the areas in which it deals with business but in the traditional areas—Customs, the Inland Revenue and the Board of Trade in the certifying arrangements in

respect of investment grants. I dare say that there is some substance in some of the criticisms. We are anxious for all these things to be looked at and for progress to be made to put the Civil Service into the best and most efficient shape to discharge the tasks which Parliament has laid upon it.
In the past, Government structures in Britain have been more equipped to respond to change than to initiate and direct it. A Government such as the present one, who claim, rightly, to speed up change, to initiate it and to affect significantly its direction, must ensure that the Government structures themselves are modified so that they can undertake successfully what is in many ways a new role for the Government organisation.
What about the shape of the Civil Service with regard to modernising its methods? Have we been sitting still? Have we been resisting in a state of complacent self-admiration? Certainly not. The Civil Service has been constantly in search of means of economizing in labour and of modernising its methods. I am satisfied that the gap which exists between the highest possible management techniques and what actually takes place in the Civil Service is no greater than is the case in private industry taking the field as a whole. If one wishes to pick on some paragon of virtue in private industry and compare it with the least efficient aspect of the Civil Service, one may get a gratifying critical result, but if one looks at the whole field of Civil Service endeavour one can be quite satisfied that the method, organisation and modernisation of the system is continuously under review and that tremendous efforts are constantly being made to utilise computers and other modern techniques of administration.

Sir A. V. Harvey: I am sorry to interrupt the hon. Gentleman a second time, but is he aware that British European Airways has been waiting for eighteen months for a decision by the Government about a replacement aircraft, and now it has got the wrong decision?

Mr. Lever: The hon. Gentleman must surely know that while this may be very amusing to him and may represent some very sincere feeling in his breast, it is not a very useful intervention to offer me a


point of this kind which I could not venture to discuss off the cuff.
I am convinced that there has been a continuous and very reassuring increase in the productivity of the Civil Service as a whole over the last twenty years. I come to this conclusion not only from the evidence of my own eyes in watching what has been done but through simple inference from the numbers that we have in the Civil Service to-day and the volume of work that has been cast upon them not only by the present Government but by successive Governments.
The fact that today we have a smaller proportion of the working population engaged in the Civil Service than we had in 1951 is testimony to the increased productivity of the Civil Service. [Interruption.] An hon. Gentleman opposite says that it is due to the Conservative Government. The fact of the matter is that as soon as the Conservative Government had disposed of the last relics of war rationing and of the Korean war and as soon as there had been the reduction in administration which would automatically have accrued to any Government in those circumstances there was from 1959 onwards a steady and sustained increase in the Civil Service occurring under the Conservative Government during the period in which we never had it so good. This is not surprising because standards were rising between 1959 and 1964.
One of the aspects of rising standards, as I pointed out, is a rise in the public services which are provided.[Interruption.] An hon. Member opposite asks whether he can quote me on that. We all know that standards rose between 1959 and 1964. They rose rather less than they ought to have done. But we are not to-day engaged in a general economic debate. We are engaged in a discussion of the rôle of the Civil Service and of the administration and the Government. Between 1959 and 1964 the employment of civil servants rose at a very rapid rate under a Conservative Government. It was inevitable that it should do so for the reasons that I have given the House. To sum up——

Mr. Onslow: If what the hon. Gentleman has been saying is true, why in the first year of the Labour Government, when the squeeze was beginning, did the

Civil Service increase by 8,000, why in the second year, when the squeeze was more severe, did it increase by 21,000, and why in the third year, when we found that we were getting poorer and poorer, did it increase by 24,000?

Mr. Lever: The increase in the Civil Service and the speed of the increase were evidence of the increase in the implementation of the long-term policies of the Labour Government. I am not in the least ashamed of that. I have said it openly to the House, and I say it openly to the country. As the economic and social policies of the Labour Government expand it is inevitable that there will be some increase in the public service over a period of time, as there has been. I am not in the least ashamed about these policies which will appear to the people of the country to involve some increase in administration services.
Mr. Peter Jenkins in The Guardian was, I think, very much on the ball when he suggested that one of the difficulties with modern government is that the kind of things that are required for the long-term advantage of the country are very difficult to explain to and to win support for from the electorate, especially where the Opposition have all too commonly a tendency to lurch into irresponsibility and to feed prejudice from the Opposition Front Bench rather than seek to give aid to the counsel of the nation.
I am not indifferent to the increases which have occurred in the Civil Service, nor are the Government. It is for this reason that we have decided that, over the next period ahead, we shall contain the numbers of the Civil Service to have, as it were, a breathing space because of the conditions and the needs of the economy which are very well known. But that does not mean that we are going to cut the Civil Service nor that we are going to cut the programmes already announced to the House and approved.
We have, in fact, done the cutting which had to be done. The existing Civil Service will, we hope, by means of increased efficiency, produce a greater volume of work while yet giving the standard of service we expect. I have every confidence that the Civil Service will be able to achieve this in view of its similar achievements in the past.
I do not complain that the Civil Service has grown in numbers and I have


every confidence in its policy. The right hon. and learned Gentleman quoted The System. I hope that he was not adopting the rash, hazardous and unfortunate criticisms of that book attacking the Civil Service, of which the author was once a member. All these charges of amateurishness against existing members of the Civil Service, all this repetitive and negative criticism, could have, over a long period of time, an unfortunate effect on public administration. I can only hope that, when right hon. and hon. Members opposite come to reflect upon this matter, they will not persist in this attitude. We live in a time when there is all too large a market for the propagation and popularisation of half truths. There are commercial and political attractions for irresponsible people to engaged in that.
I know that a good deal of the authority of the Government is challenged and undermined not by legitimate and constructive criticism which will always be a feature of Parliamentary life, but by phoney liberalism which is mere irresponsibility and by a very real destructiveness masquerading as perfectionism but completely bogus because it is not allied to constructive and detailed suggestions for the improvement of our affairs.
I beg the House not to endorse popular prejudices and negligent and irresponsible criticisms which are not directed to the improvement of our public administration, either in quality or efficiency, but are merely an attempt to arouse the least informed opinion outside the House, to nourish prejudice rather than give enlightenment outside the House. I greatly regret the nature of the argument advanced so far by the right hon. and learned Gentleman and I hope that the House will approach the public service and its rôle in a somewhat more constructive and responsible vein than he did.

4.48 p.m.

Sir Henry d'Avigdor-GoIdsmid: The Financial Secretary, if he can cast his mind back to those days, made rather a name for himself, when he spoke from this side of the House, as one of the most ingenious filibusterers we ever had to put up with. I have a feeling that his tactics today were fairly similar. He made a very short speech, dealing merely with the widest generalisations,

and relied on interventions from this side to keep his argument going. If this is the best the Government can do in reply to the Motion, their case goes by default.
The hon. Gentleman referred to the fact that the criticisms levelled by my right hon. and learned Friend the Member for Hexham (Mr. Rippon) were basically generalities. The difficulty about such a debate is that, if one gets down to detail, one makes a very boring speech. However, I am a boring speaker at any time. I have a good deal of detail, which I address particularly to the hon. Gentleman because he is open-minded and because I know that, if he really does find something worth pursuing, he will pursue it.
In the higher echelons of big industry, one gets the same sort of approach as the hon. Gentleman's. The very big companies accept that there is a dialogue between industry and the Government and that this dialogue is not entirely one-sided. It is not only the Government who ask questions, with industry answering them. Much of it goes two ways. Furthermore—and this I have been told—there are some industries which have actually found benefit from the questions asked by the Government.
But the Government must not think that, because they manage to ask a few of the right questions, they are getting nothing but the right answers. In the case of large companies, their managements are getting so involved in Government, quasi-Government, trade associations and other organisations like the C.B.I., that they are staffing half the inquiries themselves—half the inquiries in the country. No wonder they speak with the same voice, but one wonders whether that voice is properly informed.
I want to draw attention to a matter about which I know a great deal, because I addressed my inquiries to a bank in which I have a direct interest and which is included in the list of companies treated as banking or discount companies under the Companies Act, 1948. I asked the chief accountant how many returns he has to make to the statistical office of the Bank of England. That is not by Government order, but it is part of the machine by which the Government collect information. He makes.


during the year, 246 returns to the statistical office. These have nothing to do with operations but are only reporting on the past.
He told me also that 2 per cent, of his manpower—and this is trained manpower—are exclusively engaged in answering or completing statistical inquiries they have to render to the Bank of England. Very important! I asked him how often these returns are queried and how often the Bank of England asks him what has happened to cause any change. He replied that he gets about two telephone calls a year and that, provided he replies to the questionnaires in due time, they are simply put, presumably, into the appropriate computer and included in the appropriate total—and that is that.
I do not want to analyse, even for the benefit of the right hon. Member for Easington (Mr. Shinwell), the nature of these inquiries. But looking through them it is clear that the same information comes up in weekly, monthly, and quarterly returns and there are even half-yearly returns. Obviously, anyone can see that in current conditions a bank should furnish the Bank of England with certain information immediately, and I would not quarrel with two-weekly returns describing especially the liabilities and claims of overseas residents in sterling and assets and liabilities in foreign currency. These are obviously things the Bank of England should know about. But that would be much less than half the number of forms to be completed now and on that basis we would not have to use 2 per cent, of our staff to answer these inquiries once a week.
What happens to all this information? One gets the idea that so much information is going into the statistical office of the Bank of England that it looks like the pilot's cockpit of a great airliner, with a vast number of dials all over the place. But recent experience suggests that the fuel gauge was not in perfect working order, a deficiency which led to some of the mishaps which we argued about in November and will be arguing about later.

Mr. Harold Lever: I did ask for detail in my argument, but I was asking for detail of criticisms which suggest

that the competence of this Government in administration has been lower than that of the last Government or of Governments in general. This Motion is, in essence, a Motion of censure. Does the hon. Gentleman suggest that all this derives from recent days and from the administration of this Government, making them deserve a Motion of censure?

Sir H. d'Avigdor-Goldsmid: The hon. Gentleman is being too clever. Why has this matter come up? It is because the number of forms we have had to complete has increased so much in the last two or three years that we have had to engage extra men in our statistical departments. I am not talking about the competence of the Government. I do not think that they even get the information, quite apart from whether they act upon it when they do.
I want now to talk about one of the most important businesses in the country—an oil refinery. I do not suppose that the hon. Gentleman even knows, but he should know, that, where an oil refinery is acting in a bonded area, it has to keep an entirely different set of books for customs purposes than for its normal accounting activities. There are nine particulars which have to be filed in respect of every application—and I have them all here. I shall not bore the House with them, however. What is the purpose? The purpose is to prevent the illicit use of bonded material within the bonded area.
But the danger to the stability of the Revenue of the odd tin of petrol being moved in or out of a bonded area or moved about within the area is an irrelevancy. It is an example of the sort of things which the hon. Gentleman himself said were not worth collecting. If he has the time between now and the Budget to apply himself to such matters, he should, instead of insisting that these major oil companies keep a separate set of books for the Customs, allow them merely to give the Customs access to their ordinary books. All the information is available there and I suspect that it is in a very much more up-to-date form than that in which it is demanded by the Customs. This is the sort of thing I mean in referring to the inability of branches of the Government to understand how ordinary people function.
I turn to the problems of the large construction engineering companies. I have here an example concerning a firm which has a turnover of 80,000 employees a year, for each of whom it has to keep an individual record of service under the Contracts of Employment Act and because of earnings-related benefit. The information concerning the earnings-related benefit is already in the possession of the Inland Revenue. But the Ministry of Social Security does not go to the Inland Revenue for it; it goes back to the employer, who goes back to his microfilm library which is necessary to keep the records of 80,000 employees. This is something which the Financial Secretary might consider.
There is a certain amount of woolliness about the Redundancy Payments Act. Are payments under that Act to be considered as compensation for loss of a job or as a reward for a certain period of service? If they are to be regarded as a reward for a certain period of service, one treatment is needed. If they are to be regarded as compensation for loss of a job, it often happens that a large contracting company wishes to transfer someone from one branch to another. Is this person entitled to a payment under the Redundancy Payments Act, although his employment is continuous? It cannot be the Government's intention that a bonus should be paid to a man on changing his job inside the same organisation. What is the redundancy payment for? This is something which should be Government-administered. This is a payment which should be made at the end of a person's career and not in the middle of it.
I have received a very interesting paper on accident prevention. I can tell the Financial Secretary that 50 per cent, of the safety officer's time is taken up in filling in forms, and not in preventing accidents. I have a list of a total of 12 forms which he has to fill in. For instance, he has to quote the qualification and inspection date of the first-aid box certificate. He has to deal with the testing of fire alarms. He has to publish the names of the people on contract to summon, not to drive, an ambulance.
It is clear that no one has ever considered what goes on in a factory. Someone may have a bright idea,

another order is sent out and the accident prevention officer, instead of spending 50 per cent, of his time in filling in forms, must spend 55 per cent, of his time in doing it. No one has ever thought of considering what is necessary. I should not like to set myself up as an expert on what is and what is not necessary, but I am sure that it cannot be right for the accident prevention officer to spend more than half his time in filling up forms.
On investment grants—[Interruption.] The hon. Gentleman asked for details. I am going into detail.

Mr. Harold Lever: I was not complaining.

Sir H. d'Avigdor-Goldsmid: We know that a lot of what goes on in connection with investment grants is nonsensical. One of the nonsensical things is that every claim must be signed by a director. This may be very good in the case of a one-man building firm or a small company operating with limited capital. But when the board of directors is perhaps hundreds of miles from the place in which the investment grant is claimed, why should a director have to sign the claim? Surely all that is necessary is that the man on the spot who put the claim in hand should sign it. The chairman of an eminent company has said that he signed a claim for 13s. 4d. He reckoned that the overhead expenses involved in making the claim must have run into several pounds. [Interruption.] I am sure that was a helpful intervention from a seated position.

Mr. Harold Lever: I do not understand the nature of the complaint. The Government must require a form to be filled in when giving an investment grant. If common sense indicates that a firm should not bother to make a claim for 13s. 4d. because it would be too expensive to do so, let it not make it. But do not blame the Government for applying reasonable accountancy methods to the making of investment grants.

Sir H. d'Avigdor-Goldsmid: Once again, the hon. Gentleman is much too clever. He does not realise that claims get thinned down in the process of their being made. I will give a very good example.
A friend tells me:
It was only after weeks of argument that the Board of Trade agreed that earth moving was part of civil engineering. Even now they will not accept that concrete mixers on wheels are eligible for grant although every civil engineer knows that it is more efficient to use wheeled mixers than static mixers.
I do not know whether the Financial Secretary is an expert on wheeled or static concrete mixers, but people engaged in this business think that they are equally useful. It is only the unreasonable people in the Board of Trade who tell them that they are not. These are the sorts of things which certain legislation involves. People like the Financial Secretary, with all the brains in the world, say, "It is too easy; do not claim." That is not how things work.
I need not dwell too long on the ills of the Transport Bill, but there are one or two points in connection with it which I should like to make. There is a licensing authority for operators and vehicles. Every time that one goes to a licensing authority, there is an appeals procedure for making sure that justice is done. Every time there is an application for a controlled journey, there is a very complicated procedure which is well known to hon. Members. The application has to be sent to the National Freight Authority and to the British Railways Board. After they have decided that they cannot or do not wish to compete, the operator is allowed to make his request; or, alternatively, if he gets a negative answer, he is allowed to appeal against it. There is an appeal procedure on everything.
We want only two things for road transport. First, we must have, and it is sensible to have, a system under which heavy vehicles pay a much heavier tax because of the damage which they do on the roads and the space which they occupy. Secondly, we must have an effective vehicle inspectorate to ensure that unfit vehicles are not used on the roads. It is also desirable that drivers' hours should be regulated. But there are many additional proposals in the very complicated licensing system we are embarking on which is to be argued with such ferocity over the coming months. What shape it will be when it eventually emerges, I should not like to suggest. Anyone in his senses knows that it is a

completely unnecessary proliferation of the sort of bureaucracy we are discussing.
Let me give a final example. The Egg Marketing Board is an outstanding case of bureaucracy in action. Whereas the consumption of eggs has been roughly static at about 220 per head of the population over the last 10 years, two things have happened during that period. First the Board's proportion of the sales of shell eggs to consumers has dropped from 80 per cent, to something just over 50 per cent., and at the same time the return to the producer from the Board has remained absolutely static. The Board's expenses have risen from £1,365,000 to £3,623,000.
In other words, this large amount of money has been expended, nearly trebled, without selling any more eggs to anyone or paying more to the producer. The only result has been that the Board has been losing its share of the market. 'This seems to be the sort of thing that the Financial Secretary should be tackling instead of being bogged down in the sort of legislation that the Government are introducing.
We do not think that Ministers are all naturally stupid—we see some of the most intelligent men we know sitting on the opposite Front Bench. What are they doing? They are engaged on these various footling pieces of legislation which take up so much of their time. It is certainly clear to the people, and the point has been taken by hon. Gentlemen opposite now, that the time has come to allow some fresh minds into the business. I hope that we will not have too long to wait before we have a party in power who are prepared to tackle these problems once and for all.

5.12 p.m.

Mr. E. Shinwell: The other day I heard a criticism of Her Majesty's Government from a most unusual source. The Barnet Borough Council is responsible for removing garbage through the medium of gentlemen called dustmen. One of these dustmen informed me that he had always been a loyal and devoted supporter of the Labour Party and this Labour Government, but he was about to withdraw his support because we were employing too many civil servants.
I ventured to remind him that he was a civil servant—although not always very


civil. There was a remedy that had not occurred to him. The borough council need not trouble sending the number of dustmen that it does to remove the garbage. Why not leave it to the residents to deal with their own garbage? One can reduce the number of municipal civil servants in that fashion.
There is a remedy for reducing the number of persons required, not only in the so-called bureaucracy, but in this Parliament. Do we not have far too many Members of Parliament? Far too many on the benches opposite anyhow. Why 630 Members, if that is the correct number? Why not reduce the number to 300? It would mean larger constituencies, but I venture the opinion, for what it may be worth, that if the area for which I am responsible was increased from 54,000 constituents to 104,000 constituents, I could tackle the job. Let us start here reducing the number of Members of Parliament. We would save a lot of money that way. If the other side wants suggestions, I am full of them. I cannot deal with them all in the short speech I intend to make, but there may be other opportunities.
We could reduce the number of members of the Government—cheers from the opposite side. There is no reason why we require more than 100 Members of the Government. The job could be efficiently tackled with about 70 or 80. I have ventured on more than one occasion in the past to suggest to hon. and right hon. Gentlemen opposite, particularly right hon. Gentlemen, that if they cared to employ me, provided the remuneration was satisfactory, I would offer them advice on political and parlialiamentary strategy. So far my offer has not been accepted.
Take this example. All kinds of intricate problems confront the nation and the world at large, and the party opposite have to seize on this alleged problem. Too many civil servants! What about the people whom the hon. Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) represents—cluttering up the City of London every morning, commuters from all over the shop who cannot find room on the railways, partly because the number of railwaymen has been reduced? That is no solution to our problem.
I have had some experience of civil servants, way back from 1924, much longer experience than anyone on the opposite side of the House, including right hon. Gentlemen sitting on the Front Bench. I have always found civil servants efficient—perhaps I had better qualify what I said. I have always found them efficient when they did as I asked them to do. I have always found them efficient when they gave me the correct Estimates. Sometimes they gave me the wrong Estimates, but perhaps that was not their fault but their misfortune.
I come to the crux of the problem. I am told that Mr. Speaker does not like long speeches, such as we have just had. I put what I believe to be the crux of the problem in the form of a question to the other side, and I would like to have an answer before I go, because I have a meeting to attend shortly. We are told that the Labour Government have increased the number of civil servants in the last three and a half years by about 50,000. The question I have to ask is this: by what number do hon. Members opposite want the Civil Service reduced? Is it 10,000, 20,000 or 50,000? I hope that civil servants will take note of what the Tories are asking—for large numbers of civil servants to be disemployed, to be put on the street, to be retired. I see the hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths) reclining on the bench. I understand that he represents the Police Federation. Does he want to reduce the number of policemen? On the contrary, he wants an increase.

Mr. Eldon Griffiths: They are not civil servants.

Mr. Shinwell: Every Question asked by hon. Members opposite costs money and, more than that, civil servants. There has been a complaint that there are too many statisticians, and perhaps there are, but I should like the House to inquire into this statistical exercise: when an hon. Member asks a Question, how many civil servants are required to deal with it and to provide a more or less satisfactory answer? I will guarantee that in the time the hon. Member for Bury St. Edmunds has been in the House, and he has not been here long, but that does not matter—he has been long enough—he has cost the country thousands of


pounds m the employment of civil servants because of the number of Questions he has asked. The same applies to all hon. Members opposite—every time they ask a Question it means more money and more civil servants, and if they did not get the answers they would kick up a row because there were not sufficient civil servants available to answer their Questions.
I could understand if hon. Members opposite were complaining about the Government's recent announcement of a package deal. I could understand them complaining about devaluation, although many of them asked for it. I could understand them complaining because the Government have decided to withdraw forces from east of Suez, although some, for example the right hon. Member for Wolverhampton, South-West (Mr. Powell), have demanded that they should be withdrawn from other areas.

Mr. John Wells: Mr. John Wells (Maidstone) rose——

Mr. Shinwell: It will only cost more money if the hon. Gentleman asks me a question. If we were to retain our forces east of Suez, how many more civil servants would be required? The hon. Member for Maidstone (Mr. John Wells) must not break the thread of my discourse.

Mr. Wells: On a point of order. What is the cost of Questions Nos. 50, 51, 52, 53, 54, 56, 57 and 58, which stand in the name of the right hon. Member for Easington (Mr. Shinwell) for Thursday, 1st February?

Mr. Deputy Speaker: The hon. Gentleman knows that that is not a point of order.

Mr. Shinwell: I hope the House will understand that that point of order has meant that the Official Reporters have had to occupy time taking a note of what has been said by the hon. Gentleman. All this wastes time. [HON. MEMBERS: "Hear, hear."] I am not wasting time. I am asking a question, and I should like to have an answer before the end of the debate. We are entitled to an answer from hon. Members opposite.
I was about to ask when I was interrupted, quite unnecessarily, but I

do not complain about that, it happens very often in the House, why it is that hon. Members opposite do not concentrate on the things which are fundamental, on those which matter. I can understand criticism of the Government, and I indulge in a little myself. Governments make mistakes. Every Government I have known since I came to the House has made mistakes, even the Government of which I was a member.
If hon. Members concentrated on these national problems, these fundamental problems, I could understand it, even if it required more civil servants, if that found a solution to our problems. Instead hon. Members come along with this poppycock, with this silly pabulum—and there are other adjectives which I could use. If instead of indulging in this, they came along with a subject which really mattered, I could understand it, but if this is to be the stock in trade of the Tory Party at the next election, God help it. I do not know how many civil servants there are, 200,000 or 300,000, established and unestablished, but let hon. Members opposite tell them that when die Tory Party comes in 50,000 or 60,000 are to be sacked, and then let the Tories ask for the votes of civil servants.
I return to the dustman with whom I began, the loyal and devoted supporter of the Labour Party who will not vote because there are too many civil servants. There are too many of everything. I repeat, there are far too many in the City of London. We should abolish the City of London and all the people employed there and the country could be carried on quite well, but we could not carry on the country without civil servants. I hope that we shall get a satisfactory answer from hon. Members opposite and be told how many civil servants they want to dismiss. I hope that they will not indulge in generalities.

Mr. Patrick Jenkin: Mr. Patrick Jenkin (Wanstead and Woodford) rose——

Mr. Shinwell: We are to get an answer.

Mr. Jenkin: On the contrary, I want to ask the right hon. Gentleman a question, which is all I am entitled to do in an intervention. How many members of the Royal Navy at Chatham and


Portsmouth and Rochester did the Prime Minister tell, when speaking in the last elections, that they were to lose their jobs as a result of this policy?

Mr. Shinwell: Why does the hon. Gentleman put that question to me? I have been Financial Secretary to the War Office, and Secretary of State for War and Minister of Defence, and I am as patriotic as anybody in the House. I have never taken the view that we should abandon our defence. I understand the genuine and basic principles of many of my hon. Friends and, of course, I do not doubt their integrity and sincerity, but I have never taken the view that we should abandon the Navy. But what does it mean if we do not reduce the numbers? It will mean more naval men and more admirals—and I almost forgot to ask why we should not get rid of some of the admirals. [HON. MEMBERS: "And generals."] I have to be careful about generals, because I used to be very friendly with them, but of course we have too many brass hats.
But let us start at the right place, and the right place is here. There should be fewer Members of Parliament and fewer members of the Government. Bureaucracy begins here, which is where the policy is determined by the Government with the consent of their supporters and in spite of the Opposition. The civil servants are used to implement policy. I therefore suggest that hon. Members opposite should say how many civil servants they want to dismiss and that they should stop asking silly Questions which cost money and also mean the employment of more civil servants.
If you look at the Order Paper, Mr. Deputy Speaker, you will find that there are now more Questions than ever from the other side, repetitive Questions. Of course we are not living in 1815 or 1850, but the other day I was reading that at the beginning of the nineteenth century the Foreign Office employed only 26 civil servants including two under-Secretaries. They had nothing to do. Now there is much to do. We have an Army and a Navy and an Air Force; we have economic problems, we have a mass of legislation, and surely it is not the assumption that if we had a Tory Government, we would have less legislation, for we had plenty of it when we had Tory Governments in the past.
So I think these questions should be answered, and not by indulging in generalisations, and not by criticizing the Government unnecessarily, but by coming to matters which really are the primary concern of the people of this country. They certainly should not be dealt with by pandering to the more or less reputable Press of this country, some of them reputable, and some of them not so reputable, who are playing this up. "Too many civil servants, the great problem confronting this country is"——

Mr. Rippon: Too many Socialists.

Mr. Shinwell: The right hon. and learned Gentleman has far more intelligence than to indulge in that kind of talk. I credit him with having more intelligence. Otherwise he ought not to be sitting on the Front Bench there. He interrupted me and now I have forgotten what I was about to say. These interruptions never stop.
We ought to have satisfactory answers and cease to ask these unnecessary questions, and hon. and right hon. Members opposite should not pander to the Press as they are doing, working it up, boiling it up, trying to convince the country that there is something wrong with government because we have too many civil servants.
I repeat again—and we are going on repeating this——

Mr. Onslow: On a point of order. The right hon. Gentleman, by his own admission, is being repetitious. Would it not be wise to point out to him that there are many of his hon. Friends who are still waiting to make their filibustering speeches about this?

Mr. Deputy Speaker: I think we must allow the right hon. Member to make his own speech in his own way.

Mr. Shinwell: Really, for the hon. Member to talk about me as being repetitious! He is about the most garrulous person in this assembly. I would not mind if he talked sense.
I did not intend to say a word today when I came in, but I listened to the hon. Member for Walsall, South from the City of London talking about too many statistics, too many forms. No doubt there are forms which emerge from the


Inland Revenue, and I get too many of them, I know, but what should we do without them? There may be a case—I concede this—for some reduction in the Civil Service. Let us have more computers and fewer civil servants, more mechanism, more mechanical aids. That might help, but why condemn the civil servants? [HON. MEMBERS: "We are not."] Why condemn the Government—ah, hon. Members have fallen into the trap. When I say, "Why condemn the civil servants?" they say, "That is not what we are doing". What do they want the Government to do?

Mr. Rippon: Get out.

Mr. Shinwell: Many nasty things have been said to me during my experience in this House, but this is the first time a right hon. Gentleman has told me to get out.

Mr. Rippon: Not the right hon. Gentleman, but the Government. The right hon. Gentleman, I believe, might do very much better, and certainly no worse.

Mr. Shinwell: It was not me the right hon. Gentleman meant?

Mr. Rippon: No.

Mr. Shinwell: I thought he meant me when he said, "Get out". The time has to arrive some time. Listening to some of the speeches from the other side of the House, I feel that what is worse than making one's own speech is listening to the speeches of other people.
All the same, they cannot get away with it: they are not condemning the civil servants, they say, but they are condemning the Government for employing too many civil servants; their main assumption is that many civil servants are not doing their jobs. The assumption is that there is too much legislation?

Mr. Rippon: Too bad legislation.

Mr. Shinwell: The trouble with this Government is that they do not promote legislation which suits the Tory Party. When it comes to that we had better chuck it altogether.
I repeat—and some hon. Gentlemen, I know, may be disturbed by what I am repeating now, namely, let us start here and reduce the number of hon. Members

of the House—300 instead of 600. Let us do that. We could do our job as successfully as we have in the past—and if we can reduce the number on the other side of the House, all the better.

5.35 p.m.

Mr. Richard Hornby: The right hon. Gentleman the Member for Easington (Mr. Shinwell) has a number of virtues which have been apparent from time to time to hon. Members on both sides, but I think he is subject to one temptation which I think we have discovered he can seldom resist, and that is the temptation to make a speech regardless of whether he intended to make one when he came into the House. Really, I do not see why the House should suffer a lecture from him on the subject of verbosity.
Both the Financial Secretary and the right hon. Member for Easington protest that it is irrelevant for hon, Gentlemen on this side of the House to raise the subject of the growing size of the bureaucracy, and they say that there are many more important subjects we should raise. What they are in fact saying is that it is not part of the Government's business to look at the costs of government itself, and what they fail to realise is that there is a very real feeling abroad in the country today that we as a nation are over-governed, remotely governed, expensively governed, and, in some fields, inefficiently governed. It is because these are the real problems which engage the people of this country and ought to engage the Government themselves that this subject has been raised today.
Increasingly, I feel, we are approaching, in the relationship between the public and the Government, between the provinces and Whitehall, something not too far different from the relationship between the Netherlands and Philip of Spain in the sixteenth century, and we all know how that ended; it ended in the revolt of the Netherlands and in near bankruptcy for Spain. We would do well to remember that parallel. The problem for us is how we can improve the machinery of government and what advice we can give to the Government on this matter. It is a big subject, and, despite what the right hon. Gentleman as said, it is, I believe, a serious and important one.
I want to be as brief as I can because there are other hon. Members on both sides who want to speak, and so I shall confine my remarks to three main subjects. They are, first, the excessive legislative activity of Parliament and Government; second, the management of the Civil Service; and third, the overlap of functions between central and local Government. In each of these fields I think there is action which can usefully be taken by the Government both now and in the near future.
First, then, Parliament; and here my point is a quite simple one. It applies both to Ministers and, if I may say so, to hon. and right hon. Members. It is this, I believe there would be much value in every single one of us realising that there is useful work to be done in searching for laws which might well be repealed, as well as in searching for laws which night be made. If as much energy could go into seeing which laws, which were once necessary, in matters which once were necessarily subjects for legislation, are now archaic and no longer necessary, I believe that that would be a field where the Government could fruitfully release many citizens from many controls. That is in the legislative field.
In the administrative field certainly, as my hon. Friend the Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) has said, there is a similar exercise to be done in looking for sources of information which the Government require both from industry and from local authorities. In the tax field there is certainly need to look at the return which Government gets for the cost of the operation of tax collecting. If we could look at each of these fields in our Parliamentary activities then I believe that there would be useful work to be done.
In passing, I would say in answer to the right hon. Gentleman the Member for Easington that I for one am certainly not averse, in Parliamentary reform, to examination of the size of this House.
It is in the management of the Civil Service that we may look for economies. I recognise, as the Financial Secretary said, that there is a tendency, under present methods, for there to be an increase in white collar work compared with manual work. I recognise that changes in methods mean that this will

happen in both Government and industry. However, anyone engaged in industry realises that unless, at the same time as taking on new manpower to fulfil new activities, one reduces manpower and cuts down on previous activities, one will be faced with an excessive use of manpower, with excessive costs to the whole enterprise. It is in this sphere that I suspect that the Civil Service is lagging behind.
It is often said that there has been a radical change in this century in the role of Government compared with the Civil Service. The Civil Service was primarily an advisory organisation. Today it increasingly plays a managerial rôle. And I suspect that, in this managerial sphere, most of the growth of bureaucracy, as we now call it, occurs, and the problems of management lie.
In looking for comparisons between efficient management in private enterprise industry and efficiency in the Government services, we must remember that most of the motivating force in private industry derives from two things; first, the profit motive, and, secondly, the competitive knowledge that unless a host of essentially routine jobs are done quickly and well, somebody else will do them more quickly and better, with the risk of jobs being imperilled and the success of the enterprise declining.
Neither of these forces is wholly there—inevitably, since the operation is different—in the Civil Service. To that extent, the problems are not strictly comparable. Nevertheless, lessons can be learned from private industry and I shall put forward a few suggestions, mainly in the managerial sphere, which the Government would be advised to consider.
The Government could make better use of management consultants. If Shell and I.C.I, can find this useful, why is not the Ministry of Transport, for example, able to do the same? Perhaps some Government Departments are using management consultants to a greater extent. If so, I hope that we will be given this information. I would like to see management consultants being used in collaboration with the Organisation and Methods Division of the Treasury. They could make there the maximum impact at the minimum cost and in the minimum time. They would be concerned essentially with


procedures and not with policies. The problems of security and confidentiality which sometimes arise would not be present.
There is a greater need to recruit O. & M. people for the Treasury with greater care and to give them a greater level of seniority. I have the impression that most of the field work of the O. & M. Division of the Treasury is done by people recruited from the senior executive levels of the Civil Service.
If consultancy work of this kind is to have effect, extremely senior people must do the work and they must know that, when they go into the field, they are carrying authority and that attention will be paid to their recommendations. I do not wish to prejudge anything that the Fulton Committee might say about the various ranks of the Civil Service, but certainly we should consider the seniority of the field officers of the O. & M. Division.
I suggest that there are apt to be too many cross-postings between one Department of the Civil Service and another; in other words, between one Ministry and another. At a time when functions generally are becoming increasingly specialised and when special knowledge must be at the disposal of Ministers—because, in our Constitution, Ministers are non-specialist—careful attention must be paid to this matter.
If we wish to reduce numbers and, at the same time, increase business experience in the Civil Service, the Government must look at the pension arrangements within the Civil Service. The pensions being non-contributory, they are not usually transferable, except between branches of the public services or to nationalised industries. If we are to recruit the sort of people we want from outside or want to run down the size of the Service, these pension arrangements must be more flexible. Otherwise the Government will be faced, on the one hand, with an intolerable human problem while, on the other, people who are dissatisfied with their employment will feel locked in a position which they cannot afford to give up. No pension is available before the age of 55, whether retirement is voluntary or compulsory. These are important

matters which should receive immediate Government consideration.
We need to look again at the terms applying to late entrants from industry to the Civil Service. If there is to be cross-posting between industry and the Civil Service, the terms and conditions on arrival must be relatively attractive. What particularly mitigates against the late entrant is the pattern whereby he goes to the bottom of the seniority list, regardless of the age structure in the grade he has entered. In this connection, the Civil Service should examine the patterns of promotion within its departments.
If we are to have innovation and to secure drive in any enterprise, people should be promoted to quite key positions in their thirties. While accepting that there are differences in personal experience and motivation, unless people are promoted before they reach 40, experience tends to take over and the trend to innovate dies down. Too often people in the Civil Service are promoted too late, and I fear that some of the willingness to innovate is lost.
I suspect that a hard look should be taken into the clerical grades of the Civil Service. For example, too often one hears of it being difficult to even get something typed. Perhaps the whole sphere of clerical work needs reviewing. Again, I do not want to prejudge what the Fulton Committee might say about the structure of the Civil Service. But it is none too soon to start looking hard at some of these points, and I believe that many of these problems could be tackled at once, without waiting for the Fulton Report.
I come to the overlap of functions between central and local government. In many areas it is excessive and unnecessary, and consumes time, manpower and money. The Maud Report on the management of local government has pointed to excessive centralisation and the reversal of the nineteenth century trend to disperse authority, and has shown how powers have been taken back to the centre. This was, perhaps, inevitable in some areas, but not in others. If we are to believe that Report, the position here is very different from that in Sweden and America, in both of which countries there is a far greater degree of local autonomy.


The housing regulations present one example of this pattern of overlap between central and local government. Schemes are prepared by the professional staff of local authorities in accordance with rigid centrally imposed standards and cost limits. If the professional staff are able to do it at the local level, why should the whole show be referred back time and again to the central authority? It only involves more paper work, more delay and more consumption of manpower, much of which is skilled and could be better used elsewhere.
The right hon. Gentleman the Member for Easington was entirely wrong to talk about the dangers of unemployment. The danger is that by the wrong use of manpower we can in many fields so put up costs that we are out of business in many others. That is the danger to the right hon. Gentleman's constituents. It is not for this House to protect the public service at the expense of the country at large. We must face that fact, although, of course, in relation to our civil servants we must also be good employers in everything we try to do.
With this overlapping of functions we have unnecessary delays, unnecessary costs and duplication of staff, but after all that has happened, what usually follows? I looked into this in terms of local authority applications for relaxation of the building regulations, and found that in Tunbridge Wells not one application in the last 60 had been altered in any way at all. That, of course, is a tribute to the good sense of the Ministry of Housing. Why have this overlap at all? It means using professional staff quite unnecessarily, and duplicating all the way down. In many places some of it could be got rid of.
If one wants an alternative solution, and if the Government are worried about too many differing patterns and procedures, and of mistakes being made, why not replace the present system by random checks, with threat of reduction of subsidy—as the Government have power to do—if errors are found out afterwards? That would be a perfectly legitimate form of managerial control. Why not attempt it now, rather than talk of a total reform of law of local government, when we may be well into the 'seventies before we have the answer?
To summarise this point, I can do no better than quote from the Maud Report, which states:
The Government, in consultation with the local authority Associations, should examine existing legislation to see what provisions might be repealed with a view to leaving local authorities the maximum freedom in organising their affairs and carrying out their work.
I have made three points, and I have no doubt that other hon. Members will advance other views. In each area, something can be done for the benefit of efficient, speedy and humane Government, and the saving of costs. In many places our present system of checking and counter-checking is much too slow, and it is now up to Ministers to lead the Civil Service out of the straitjacket of the present system if we are to get the efficient and relevant government the country demands.

5.54 p.m.

Mr. Charles Panned: The hon. Member for Tonbridge (Mr. Hornby) made a very attractive speech, although I do not think that it added much to the rather sonorous terms of the Motion. It was a comfortable speech, which he and I, having had a great deal of experience in local government, could discuss round the table or in a committee room. It might be suitable for a Specialist Committee, but I did not hear him sound a great note of condemnation.
I am still amazed that the Opposition should have chosen this subject for a Supply day debate. We have the package deal. The party opposite will not agree with hon. Members on this side about taking off the prescription charges, but they must at once admit that to do so would cut out a great deal of what has been called by them unnecessary work, and I suppose it would count as a contribution.
I am glad that the hon. Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) has entered the Chamber. I had rather hoped to follow him, but my right hon. Friend the Member for Easington (Mr. Shinwell) intervened instead. I do not think that the hon. Gentleman's case stood up. I want to take him back to a common experience we had in 1946, when we were both members of the budget sub-committee of the Kent County Council Finance Committee,


trying to get the rates down. It was I, not he, who found out that over the years the county council had always overestimated to the tune of about £340,000, and had always made its balances that way.
It was I who moved a rate reduction of 6d., and convinced the Conservative members, who ratted on their then leader, the hon. Member for Walsall, South. They reduced the rate in 1946 by 6d., and the county council now budgets on a rather better basis. Nevertheless, it has never been able to reduce the county rate. That has always gone on and on, and up and up, for the reasons given by my hon. Friend the Financial Secretary, which is that the pattern of public intervention, and the rising standards demanded by people, particularly in education, are reflected in public expenditure.

Sir H. D'Avigdor-Goldsmid: The right hon. Gentleman has a vast knowledge of local government, and has recalled the time when he and I served on the Kent County Council. He had a vast experience of local government and in 1946 I had no knowledge at all. I took the view that his experience was valuable, but I must put the record straight. He refers to the Conservatives, but he will remember very well that it was not until he and his friends had brought the business of the council to a standstill by the introduction of what might be called Labour tactics in 1946 that there was ever any form of organised political activity in the council.

Mr. Pannell: The net result of our intervention was that the rates were reduced below the Tory recommendation by 6d. The hon. Member led his party; if he led it with very little knowledge, that has nothing to do with me. The rate went up steadily in the county of Kent because of the demands of education. When Kent County Council demanded that the fire service should come back under its control, the rate went up by 10d. This is what happens when people want better service. This is germane to the argument about whether the fire services could be better run by the Home Office. Kent has a fire cover which is comparable only to that of the county of London.
Before I came to this House I spent all my time as an engineer on road transport. I have seen the intervention by all Governments into road transport. I have seen the pattern of transport change in the country. Railways are on the way out and they have suffered a diminution, almost an avalanche, of men leaving their employ. By putting heavy loads on to the roads we create new dangers.
Think of the legislation which was brought in by hon. Members opposite, such as the Road Traffic Act of 1955, which has increased die number of civil servants. They did not want to have spot checks of road vehicles, but whenever an accident happens there is trouble. So road vehicle testing was brought in by hon. Gentlemen opposite. The demand for State intervention in all these things has been steadily rising. I am willing to bet that however much hon. Members opposite deplore the fact that my right hon. Friend has brought in breath testing, if they came to power they would not repeal it.

Mr. Eldon Griffiths: That does not mean more civil servants.

Mr. Pannell: Is the hon. Member seriously arguing that State intervention in that manner does not increase the number of civil servants?

Mr. Eldon Griffiths: The right hon. Gentleman made a specific point about the breathalyser. The breathalyser is implemented by the police with no increase in manpower whatever. In fact their numbers are being reduced.

Mr. Pannell: That seems to be a distinction without a difference. The social pattern means that the State intervenes steadily more into affairs from which it kept out in the past. The net result is to increase the number of public servants. From my argument I use the police as civil servants. The hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths), in a field in which he would declare an interest, is pressing all the time for more police to do manifold jobs which the State has to put upon them.

Mr. Cyril Bence: And for higher salaries.

Mr. Pannell: And for higher salaries. I understand the argument and I sympathise with it. It is no good hon. Members opposite saying, as they often do by way of cliché, that we have the finest Civil Service in the world and then in effect denigrating civil servants.
I do not happen to agree with my right hon. Friend the Member for Easington about the number of M.P.s. I do not think we have too many. I find that more than 60,000 electors in West Leeds is enough for me to look after and some hon. Members have 94,000 constituents. I do not doubt that no self-respecting M.P. believes that he does only half a job here. In effect the number of civil servants depends on policy. We have been attacked by hon. Members opposite who have suggested that the activities of the Parliamentary Commissioner have not been wide-ranging enough. That appointment has involved the employment of hundreds of civil servants, but their proposals for his appointment would increase the number to thousands. There is no question of this. [Interruption.] The right hon. and learned Member for Hexham (Mr. Rippon) had better not say too much, because he was a great empire builder when he was at the Ministry of Works.

Mr. Rippon: The right hon. Gentleman must know, since he was my successor, that we planned an 18 per cent, reduction in staffing in two and a half years through redundancy. I am sorry that when he came to office he did not carry that out. The amalgamation, of course, caused an increase in one Ministry but it made a decrease in the other and if the Labour Government had carried out the plans which the right hon. Gentleman inherited there would have been a considerable reduction.

Mr. Pannell: When he was my predecessor, the right hon. and learned Gentleman had a handbook printed with his photograph on the front of it. In the handbook he told how the number of civil servants had increased in the Department. He was a great empire builder. I did not criticise the Department which I took over. He and I are personally friendly about this, but he must not take advantage of my normal kindness in giving way to try to get away with saying things at the Dispatch Box which

he would not say in private conversation. The Ministry of Public Building and Works grew and took in very many other things.
I come back to some points made by the hon. Member for Tonbridge. He said there was too much legislative activity. I am not quite sure what he meant. Hon. Members opposite are never short of legislative proposals, although this afternoon they appear to have been short of a decent subject for debate. Back benchers opposite bring in a proliferation of Private Members' Bills.

Mr. Hornby: I suggested that we would do well to see whether some of our activity should not be devoted to repealing some legislative activity.

Mr. Pannell: Now we are on the same beam. Until I was a Minister I tried all the time to do away with the interference in our affairs by the Lord Great Chamberlain, but I never got any support from hon. Members opposite. They were prepared to have our affairs managed and run by an official from another place, until, when I became Minister of Public Building and Works, we made this House of Commons a self-respecting institution. Now everyone tries to go on to the Services Committee and says "Me too".
The hon. Member went on to speak of a subject on which I have spent a great deal of time, the overlap of local authority and central government. My view, which was first expressed more than 20 years ago, is that the regions should be sufficiently large—apart from those services where there is a centrally borne contribution to the local rate—as to be almost autonomous. Take the position of town clerks. The new controller of the City of London will earn—not earn, but will get—more than any other civil servant. It is ridiculous that a great authority such as that should come to the central Government for permission or or relatively small things. The same kind of thing is true of Kent and all the great cities. I do not know how the hon. Member for Tonbridge is to rationalise the question of random checks. I have found that whenever random checks are taken and someone slips up, there are complaints and not least in this House.
My right hon. Friend has made the point that the Civil Service has increased,


is still increasing and will not diminish. It will go on increasing under every Government as everyone takes a more sophisticated view. No one would want to go back to the conditions in the period of the Industrial Revolution in which the normal expectancy of life in the working-class was 18 years and when 350 of every 1,000 died in their first year of infancy. From that all the legislation on public health sprang. In the early days of Queen Victoria's reign the Asiatic diseases of cholera and small pox ravaged the country. Then local government was born and more civil servants were appointed. The outcome has been that more responsibility by the public sector has impinged on society.
The demand is still clamant. Hon. Members opposite will still bring forward their Private Bills which will cause the addition of more and more civil servants. They do not do it because they are wasteful or wicked men; they do it because they are humane men and they want a better sort of place than we have at the present time. This is the sort of thing which will continually go on.
This Government have decided to reduce the Armed Forces. The House was divided on that last week. Yet nothing is so inflationary as a soldier; everybody knows that. Talking in terms of economic wealth, soldiers may be necessary, but they are a deplorable necessity. But we have got nothing at all about that. Instead of the sort of things which we presented to the House in the package deal, on which the Tories could have reasonably led an attack against the Government, they have chosen this, and I think they have chosen this because it is highly emotional.
I am willing to bet that any one of these hon. Gentlemen, meeting a civil servant in his constituency, will not say, "Are you doing a useful job?" He will say, "It was not you I meant. Are you doing a job with some high-faluting title? I have no doubt you are socially necessary".
Over the whole history of Conservative Governments this sort of thing has always been done. It was the foundation in the early thirties of Lord Rothermere's anti-waste campaign. Always we get this claim for reduction of public expenditure

and reduced taxation, in spite of the demand for more services from hon. Gentlemen opposite. I therefore think that this is an entirely phoney debate, a debate on which this House should not be wasting its time at this moment.

6.12 p.m.

Mr. Michael Alison: I thought that by far the most interesting point made by the right hon. Member for Leeds, West (Mr. C. Pannell)—it echoed a point made by the right hon. Member for Easington (Mr. Shinwell)—was this self-admitted blind spot. They cannot see the relevance of this debate about bureaucracy, and it is precisely their failure to see the relevance of this for the great British public that explains the failure of the great British public to see the relevance of the present Government and their policy. In fact, the relevance is acutely perceived and understood in social, political and economic terms by the country at large, and if hon. Members opposite cannot see the relevance they should look to their own blindness and not look to the Opposition.
I want to try to demonstrate the relevance of this issue precisely from the theme that the Financial Secretary himself advanced as the justification for the growth. He used the interesting phrase, "the long-term secular trend" in the public services. I think this is quite a convincing facet of the argument. Admittedly, there is a long-term secular trend upward in the demand for services, not only Government services, but services generally. What I think the Financial Secretary and the Government have overlooked is that they are not the only contenders for growth in long-term secular trends. There are certain other fields in which there is a long-term secular trend upward, a growth in demand. It is not only in public Administration.
An interesting chapter in the National Plan—Chapter 3, I believe—contains a fascinating paragraph (paragraph 17) headed explicitly, "Bids for manpower". I emphasise the words "bids for manpower". The very phrase implies something which I want to stress particularly, namely, that there are within the economy at large—this is the key factor in the manpower situation—a number of different pulls in contrary directions. It is not only the public administration which wants to increase its reserves of


manpower, but also manufacturing industry, mining, quarrying, agriculture, and engineering. They also want to be on what the Financial Secretary described as long-term secular upward trends.
Surely the whole issue in this struggle for an upward trend is—which of these various bidders should pull it off, should scoop the extra manpower, should divert the resources to their particular bid? This is where we have a quarrel with the Government and where we think-that they have really failed in solving this problem.
Let me just remind the Financial Secretary of two key figures which the National Plan projected. The Plan said that there would be a net increase in the working population between 1964 and 1970. I stress the words "working population". The National Plan forecast a net increase in working manpower available of just under 400,000; that is, the available working population, broken up over the various sectors—public administration, manufacturing, mining, quarrying and all the rest—would increase in the period of the National Plan, the period in which the Government's reputation was going to be made or broken, by just under 400,000.
But the National Plan tells us that the; health and education services alone will need half a million people. They would like to pre-empt, and more than pre-empt, by their own demands—they could if they are successful in the bid—the whole of the net increase in the population which will be available for work at large.
We all agree that the public wants the services sector of the Government to increase to some extent. It is also necessary that a whole lot of other sectors increase. The key problem is which sector will win in the bid. This is where we often overlook something which the House should not overlook and which the Financial Secretary should not overlook and which is the most unpleasant and disquieting factor as we look ahead at the next few years. I refer to a unique feature of Government forward planning where it concerns the resources they are going to divert to their own use which is not a feature of the forward planning either of consumers or of industrialists and manufacturers. The

Government has this uncanny, unholy and most undesirable knack of projecting their forward requirements in financial terms—that ultimately means in the command they have over manpower and real resources—at constant prices. The Government say, for example, in 1966–67 or 1967–68, "We will budget to spend in 1968–69 and 1969–70 £X million at constant prices". If, in the intervening two years, the whole price structure rises so that the services they command or the resources they wish to command cost more, all that the Government sector does is simply to make more money available. The Government determine in advance to maintain their share and scale of consumption at a constant level, whatever happens.
Let us compare what happens to the ordinary private consumer with a more or less fixed volume of income coming in, particularly fixed in the age of prices and incomes policy. If he finds that prices rise and that the cost of the goods or services he wishes to command rises, does he correspondingly simply increase his outlay on those services to maintain the consumption at a constant level? Not at all. He must trim, cut back, consume less of what he wants, because the prices have increased. But not the Government. As soon as the price of the commodities they wish to command rises, they simply increase the outflow of money to maintain their consumption at a constant level.
The disquieting and worrying thing about this is that, in a period where some sectors are being restrained, the Government sector can run free. It must not be forgotten that since 1965 manufacturing industry and employment in the productive aspects of our economy have all been pegged back to a ridiculously low rate of growth, particularly manufacturing investment. It simply means that, if one sector maintains its level of consumption at a constant rate, whilst others fall back, the constant sector simply diverts resources to itself. What is so unfair about the present set-up is that the Government have an absolutely unchallengeable power, in the bidding for uses of manpower, always to succeed in diverting resources for their own sector.
I illustrate this very briefly by reminding the Financial Secretary of the actual


outcome, in terms of employment in different sectors of the economy, since 1965. These are the really shocking things set against the proper use of manpower in the economy. I take June 1965 as the basic point. Since 1965 the total number of people employed in the economy at large has dropped by ½ million. This is largely due to the increase in unemployment, but various other factors may be involved—for instance, a fall in the numbers coming forward to work because of the incidence of Selective Employment Tax and various other things. There has been an actual drop in the numbers employed in this country of about 500,000. This is reflected in drops in employment in electrical engineering and manufacturing, a key export sector, of 20,000 between 1965 and 1967, and in vehicle manufacturing, another key exporting sector, of 63,000 between 1965 and 1967. In these two manufacturing areas the manpower employed in these crucial years has been declining. Let us look at the public service and public administration sector.

Mr. Cyril Bence: Mr. Cyril Bencerose——

Mr. Alison: May I first complete this sentence before I give way to the hon. Gentleman? We find that while the numbers employed in electrical engineering and vehicle manufacture have declined, in public administration—the local health services, etc.—the numbers have gone up by 80,000 in this period. Redeployment has thus consisted of making men unemployed in the crucial export industries, waiting till those people are on the market and then sucking them up into public administration. This is what happens when forward Government expenditure is so planned that it is maintained at a constant level, whatever happens to prices.
The Government divert resources themselves. I know exactly what will happen when the boys come back from the Far East. All these guardsmen, sergeants, corporals and privates from Asia and the Persian Gulf will end up as parking meter attendants. I guarantee that. This is the one sector which, being fed by a constant flow of Government money, will have the potential to mop up this redundant

labour. This sort of thing is happening the whole time.

Mr. Bence1: Has the hon. Gentleman considered that quite a large number of people—I have not the actual figures with me—have been transferred from one form of employment to another and are self-employed on a contractual basis in order to avoid redundancy payments?

Mr. Alison: I hope the Financial Secretary to the Treasury will be able to tell the hon. Gentleman exactly how many people that applies to. In the construction industry it might be a few, but not as many as has been supposed.
The trouble is that the Government say that their sector reflects the demand for services which must be allowed to increase on the upward secular trend, but they ignore the fact that there are other sectors of the economy which also want to take part in the secular trend. I can give a simple answer to this problem. Let the Financial Secretary apply to the Government the discipline which is applied to private consumers and to private industry. When prices rise for the resources the private sector wish to command, they cannot simply increase the volume of money they lay out to purchase those resources, so they have to cut back. Investment and employment are cut back. Consumption is cut back. Why should not the Government exercise the same discipline as is imposed upon private industry and the consumer? Let them project their 1968–69 public expenditure at a fixed figure which cannot be increased when prices increase. This is what private business has to do. Then there will be some chance of a diversion of resources from themselves to exports.
Let me put this question. When we talk about a massive shift of resources to exports, does this mean a shift of the resources of manpower—a crucial and fundamental factor—to manufacturing the things that we want to export? Does it mean a shift in manpower? If it does not, how will the resources for exports arrive? If it does mean a shift in manpower to exports, let us be told what real self-denying ordinance the Financial Secretary will impose on the public sector. It is no use talking about a temporary discontinuance in the rate of growth of employment of manpower in the public administration. There must be


a cut back. We want to know how and if and when manpower will come out of the swollen public sector and be transferred to the exporting industries. The Government have been too privileged in the way that they have been able to juggle the financial systems in order to insulate the public sector from the squeeze. Let them come into the arena and suffer from the squeeze themselves. Then the country will be better off.

6.25 p.m.

Mr. Denis Coe: I hope the hon. Member for Barkston Ash (Mr. Alison) will forgive me if I do not follow him in his argument. When he talks about all the sergeants, corporals and privates coming home from the Far East and becoming parking meter attendants, one cannot take this argument very seriously.
The speech of the hon. Member for Tonbridge (Mr. Hornby) to some extent redeemed the arguments which have been put forward from the benches opposite. He made an interesting and constructive speech in which he discussed carefully the whole problem of the machinery of government. I suspect that one of the reasons why the benches on this side of the House are so sparsely attended this evening is that many of my hon. Friends suspected that the major case which would be put from the Opposition Front Bench would be a tub-thumping election speech which bore very little relationship to the problems facing us in the machinery of government. It is interesting to note that even on the benches opposite only 33 Members could turn up to support the right hon. and learned Member for Hexham (Mr. Rippon).

Mr. Onslow: Mr. Onslow rose——

Mr. Coe: I will give way in a moment. It is not that we on these benches do not see the relevance of discussing the machinery of Government. We do. Indeed, we welcome a sensible discussion and examination of the subject, and I will try to indicate some of the ways in which we are already making changes in this field. What I object to is the irrelevance of an Opposition putting forward the Motion in this manner and not having the decency to turn up in respectable numbers to discuss this problem.
As the hon. Member for Tonbridge pointed out, the association between government

and the increase in governmental activities in our society has continued over the years. It is not something which started with the Labour Government. It has continued throughout the century and, as my hon. Friend the Financial Secretary pointed out, it has steadily increased.
There are specific reasons why, in some instances, the number of civil servants has recently greatly increased. It has done so because we have extended certain services of which the House has approved. I for one am very glad that we have done this because they have been neglected for many years when the party opposite were in power. For this reason I am glad that we have had an increase in the number of civil servants.
The right hon. and learned Gentleman said that he was afraid there was a growing gap between the electorate and the Government. Hon. Members opposite have asked why public relations officers should be appointed to various Ministries. I believe this is one of the sensible things this Government should do. [Laughter.] The laughter demonstrates the frivolity in which this whole debate is being conducted by Members opposite. I am trying to raise it to a more serious plane. If measures such as rate rebates and increased benefits of various kinds are to be enjoyed by the people who deserve them, it is absolutely right that the Ministries should increase the number of people who are required in order to do those jobs. If hon. Members think that is highly amusing I am sorry, but it seems to me to be a very sensible thing for us to do.

Mr. Eldon Griffiths: I am interested in the point the hon. Gentleman is making, particularly his reference to public relations officers. Does he consider that they have done their job well? If so, why is the Government's image so bad? If he thinks they have done their job badly, why are they not sacked?

Mr. Coe: The hon. Gentleman always speaks in riddles. I am sorry that he does not make himself more specific. I expect they will do their job extremely well. In fact, I hope the hon. Gentleman does his job for the people he represents as well as the public relations officers do theirs.
I want now to come to the speech of the right hon. and learned Member for


Hexham. I am sorry that he is not present at the moment. I thought it was a speech which would not have done credit to a sixth-form debating society. It was full of innuendo and half-suggestions. I shall show what I mean by taking some of the main points he made about what his party would do if it was in power.
The right hon. and learned Gentleman talked about local government. He pointed out that the Maud Report was now published, saying that, if his party was in power, it would implement all the proposals in the Maud Report. That is manifest nonsense in the context of local government organisation at present. There are aspects of the Maud Report on the management of local Government which could be instituted right away, but the right hon. and learned Gentleman talked about giving local authorities a great deal more power to spend their money without any central control at all. That sounds fine until one examines the situation in local government today.
One of the basic reasons why the Royal Commission on Local Government was set up was precisely to make certain that local government units were of a size which enabled them properly to carry out their functions. The right hon. and learned Gentleman is wrong, therefore, to suggest that it would be possible to do everything at this point in time. It was a half thought out idea which sounded fine, suggesting that the Government were not moving fast enough on the Maud Report, but, in fact, it gave no answer at all. There is a problem here. There is a great deal to be done in allowing local authorities more individual decision-making power than they have at present. But this can be done only within the context of units of reasonable size.
Again, the right hon. and learned Gentleman poured scorn on the establishment of regional planning councils. He put nothing in their place. It was a half-"snide" remark—this is not good enough, he said, and his party would not do it—but he proposed nothing to replace them. Until we have the full report of the Royal Commission on Local Government, it makes very good sense to have some form of regional organisation, how-

every imperfect, which can adapt and use the opportunities it has really to get to know its region and to begin to work in consultation and co-operation with the Central Government. I do not suggest that it is ideal. It is not. But the setting up of these councils by the present Government is a step in the right direction. On those two grounds alone, therefore, the right hon. and learned Gentleman put nothing constructive to the House.
I believe that we have to be careful, when we deal with the machinery of government at local and regional level, not to create too many ad hoc bodies with the result that, when the Royal Commission does report, we are in something of a straitjacket, with some ad hoc authorities working alongside a few regional and local bodies. There is a real problem here in the machinery of local government which, in my view, must be considered carefully.
The right hon. and learned Gentleman went on to talk about Parliamentary checks. He said that Parliament was a body which was either being ignored or dictated to by the Executive. Again, I accept that there is a problem here for the machinery of government, but right hon. and hon. Members opposite have no right to argue that we are not tackling it. In fact, it is the other way round. This Government have begun to tackle that very problem of how to redress the balance, so to speak, between the Executive and Parliament. In this Parliament, we have begun to make important changes in our procedures. It is this Government who have created the ombudsman. These are genuine and, in my view, attractive ways in which we can begin to redress the balance.
Moreover, this Government have set up important Select Committees. The right hon. and learned Gentleman mentioned the Select Committee on the Nationalised Industries, and I am glad that he did. He could have mentioned the Select Committees on Technology and on Agriculture, or the one which is to come on education and the pre-legislative Select Committee. These are genuine examples of how this Government are tackling the problem of the machinery of government at Parliamentary level.
Next, and in some ways, perhaps, most unfairly of all, the right hon. and


learned Gentleman looked at the question of the Cabinet and the relation between the Cabinet and the Civil Service. He purported to quote a number of observations made by my right hon. Friend the Leader of the House when he discussed the machinery of government on television recently. I did not interrupt at that point because, as the right hon. and learned Gentleman carried on, I could hardly believe that he was making his points seriously.
In my view, when he made those observations on television, the Lord President was being honest not only to him-self but to the public as a whole. He was demonstrating all the difficulties which prevail in Cabinet government. He was not trying to fudge the whole question and suggest that Cabinet government is ideal. On the contrary, he pointed out the dilemma which has faced every Government and every Cabinet in the past 20 or 30 years. As the business of government increases and as the difficulties of delegating major decisions increase, so the problem of deciding on the size of the Cabinet and the actual content of what is to be discussed there becomes greater. These problems my right hon. Friend had the honesty to face fully and in public view.
I should have expected right hon. and hon. Members opposite to receive that as the very thing they wanted, the opening of public discussion. Instead, when the matter is raised in the House, they do not deal with it in that way but they use the opposite argument, casting a slur on my right hon. Friend, saying that he is the worst informed of Ministers, and adding every innuendo such as those which the right hon. and learned Gentleman threw out in his speech. Again, I accept that there are major problems here, and I pay tribute to my right hon. Friend for having the honesty to pose them. I hope that, as a result, there will be a more genuine knowledge of the problems facing Cabinet government today.
Now, the Civil Service. The right hon. and learned Gentleman was most anxious, as his right hon. and hon. Friends have been, not to be accused of in any way denigrating the Civil Service. But I put it to them. Month after month, we have had from the Opposition Front Bench and from hon. and right hon.

Members opposite the question—Why are civil servants here, why are they there? There has been a constant battery of criticism about the Civil Service. Whether they like it or not, this is seen in the country as specific criticism of the Civil Service. I ask them to consider the position of civil servants continually subjected to that sort of thing. What is the morale of civil servants likely to be if it goes on? What is the morale of local government officers likely to be? I see one hon. Gentleman shaking his head, but, if he knows anything about local government, he must know that local authorities cannot recruit their full quota of senior officers now. The position is difficult as it is. Why make it more difficult by that sort of uninformed and wrong-headed criticism? The Opposition ought to think more carefully about what they say.
I turn now from what the right hon. and learned Gentleman said to one or two comments of my own. The main aspects of this matter which must concern us are local and regional government, on the one hand, and the position of Parliament, the Government and the Executive, on the other. Quite apart from the aspects of the machinery of government which I have already discussed there are other matters which, in my view, ought to be closely examined. Although hon. Members opposite did not, I welcomed the experiment by my right hon. Friend the Prime Minister in setting up the Department of Economic Affairs. There is a real place for a division of function in financial affairs between the Treasury, looking at present financial problems, and a body taking a long-term look at the economy in the general sense and bringing together all the different aspects of economic activity. I therefore welcomed the establishment of the Department of Economic Affairs.
Perhaps we should now examine some of the other Ministries which could be married either with the Department of Economic Affairs or another Ministry, or Ministries. It could be argued that we have too many Ministries and the machinery of Government could be improved if some were merged. Perhaps we could find a way of marrying, for example, the Board of Trade with the Department of Economic Affairs. After all, a number of the functions of the


Board of Trade, particularly those connected with regionalism and the whole question of advance factories and development certificates could more properly be carried out by the Department of Economic Affairs. Its transport responsibilities could be undertaken by the Ministry of Transport and other responsibilities by the Ministry of Technology. Perhaps there could also be a marriage between the Ministry of Power and the Ministry of Technology. I should also like to see much more definite lines of co-ordination between different Ministries. These are examples of major problems at the centre of the machinery of Government.
This is a time when the whole machinery of Government is being examined. Local government has been looked at by the Maud Committee, and is now being examined by the Royal Commission and by the Seebohm Committee. At other levels, the Fulton Committee is looking at the Civil Service. We are bringing forward proposals in town and country planning and so on.
If hon. Members opposite want a sensible and reasonable discussion about the machinery of Government, that is fine. But I completely reject their attempt today to make political capital out of a continuing and sensitive problem, about which hon. Members on both sides of the House have every right to be concerned.

6.43 p.m.

Mr. James Dance: I hope that the hon. Member for Middleton and Prestwich (Mr. Coe) will forgive me if I do not deal with all his arguments. However, I take him up on his suggestion that we on this side of the House are running down the civil servants or denigrating them. Far from it. What we say is that the Government are making their life quite impossible and giving them ridiculous and hopeless jobs to do.
After 3½ years with a Socialist Government, the nation is becoming increasingly aware that personal freedom is being dangerously eroded by an inflated bureaucracy. There are more and more forms for everybody to fill up, and our privacy is continuously being invaded. The British citizen is allowed less and less opportunity to conduct his life

according to his own desires. This state of affairs is a direct result of legislation rushed through by the Labour Administration. The result has been clearly shown to be the stifling of private enterprise, a fall in productivity, and much wasted time in unravelling complicated Measures imposed by the Government.
In Britain, we have rightly prided ourselves on possessing the best Civil Service and the best civil servants in the world. But, because of Government muddle, our civil servants are—most unjustly—becoming more and more out of favour with the British people. When the Civil Service becomes too large and top-heavy, bureaucracy flourishes, and it is bureaucratic red tape that stifles private enterprise.
Let us look for a moment at the growth of the non-industrial and non-productive branches of the Civil Service in recent years. In January 1964, the total was 413,000, but between October 1964 and October 1967 the numbers leapt to 470,000, an increase of 57,000 under Socialism.
In the recent economic debate the Prime Minister kindly assured us:
Government Departments will … plan their staffing so that over the year 1968–69 there is no further net increase in the number of civil servants as a whole".—[OFFICIAL REPORT, 16th January, 1968; Vol. 756, c. 1591.]

Miss Margaret Herbison: Has the hon. Gentleman looked at the reason why there has been an increase in the number of civil servants in some instances? Has he looked at the Ministry of Social Security, which has now far more than half a million people receiving a supplementary pension? One cannot do that without the civil servants who have the kind attention that those old people need.

Mr. Dance: I appreciate that help given to those old people is essential, and we all accept that it must be administered, but I am not grumbling about the growth in the number of civil servants there. My complaint is about the growth in many other places with which I shall deal later.

Mr. John Wells: At an establishment in my constituency which was formerly administered by three county council employees is now administered by about 10 civil servants, with the same output in kindness to old people.

Mr. Dance: That is just the kind of point which I support.
I was referring to the Prime Minister's kind promise that he would not increase the number of civil servants. That is just not good enough. It is no use saying that there will not be an increase, what we demand and want is a decrease. For the life of me, I cannot see why the Prime Minister does not call his Departmental Ministers together and tell them categorically that there must be a cut of X per cent, in their Departmental expenditure by a certain date this year. That was the step which the then Mr. Winston Churchill took after the last disastrous Socialist Government.

Mr. Bob Brown: Mr. Bob Brown (Newcastle-upon-Tyne, West) rose——

Mr. Dance: I have given way quite enough.
A halt should be called to the acquisition of land by the Ministry of Public Building and Works in central London. I read a very interesting article on the subject yesterday in the Sunday Telegraph, which alleged that unwise and inopportune buying by the Government has cost the taxpayer many unnecessary thousands of pounds. It quoted one well-know agent as saying: "They"—the Government
are our best customers but we can't help feeling that they are not sufficiently careful with money which has come from taxpayers' pockets.
That was said by a man who is interested in the matter and earning money from it.
It would be much better to make cuts in direct Government spending than to jeopardise our interests abroad by the withdrawal of our presence east of Suez and failing to honour our pledges to our friend in the Commonwealth in the Far East.

Mr. Bob Brown: Mr. Bob Brown rose——

Mr. Dance: I will not give way.
The Government have an extremely wrong conception of the usefulness of travel from the national point of view. There should be a cut in Government travelling expenses. At no time have Ministers travelled more extensively and less effectively than at present. The usual result of their wanderings has been to make Britain look slightly ridiculous.

We all realise the immense need to increase our export effort. With that in mind, I have made it my duty to talk to many large exporting companies and see if there is any further assistance we could give them. I find that there is a constant complaint, and one that I think is very fair, from leading exporters, many of whom have to spend more than three months a year in other countries, and that is that they are not allowed to take their wives with them—unless entirely at their own expense. Yet they read not once but many times that the Foreign Secretary's wife accompanies him. [HON. MEMBERS: "Cheap!"] No, it is fair. The Foreign Secretary may argue that she contributes to the success of his work, and that may be perfectly true, but so do the wives of my exporting friends, who go so far as to say that in the Americas the social side of life is so important that without one's wife one is not entertained by the head of a corporation or concern but passed on to the No. 2. It strikes me that if the Government are so profligate in spending our money they should give some thought to making stern cuts in the expenses of non-productive Ministers and bureaucrats and invest a little more in the success of our all-important exporters.
I am informed that the iniquitous Selective Employment Tax, apart from being a ogreat disincentive to everybody, costs some £2 million to collect and that the Land Commission also costs some £7 million. What the cost of the Transport Bill, which is certainly the most vicious most vindictive measure against private enterprise, will be I dread to think. But it will be an immense sum.
A further glaring example of wastage of time and money is the scandal of the replacement of investment allowances by investment grants, a measure typical of the Government and their muddled thinking. Each grant has to be checked against a list of conditions some 36 pages long, and I am told that the Board of Trade requires 11,000 staff to administer the grants, whereas under the Conservative system only about 50 man years' work for assessment was required.

Mr. John Pardoe: The hon. Gentleman has mentioned, for the second time in the debate, the investment grants. I come from a development area. Is he aware that in the


development areas we are profoundly grateful for the investment grants?

Mr. Dance: That may be so. On the other hand, the system in industry as a whole has made life very much more difficult for the average manufacturer and industrialist.
I have already said that we have the finest civil servants in the world, particularly at the highest levels. Why, then, did we have to co-opt foreigners to reorganise our most important economic systems? It must have been most galling for our senior civil servants to work under Messrs. Balogh and Kaldor, whose previous work in other parts of the world had proved so disastrous, and who here in Britain—[Interruption.] It is not unworthy.

The Minister of State, Ministry of Housing and Local Government (Mr. Niall MacDermot): It is considered unworthy in this House for hon. Members to attack civil servants who are unable to answer for themselves, and to do so by name, to identify them, and on the ground of nationality.

Mr. Dance: The Government should not have employed them in the first place. They have produced tax formulas so complicated that even our experienced chartered accountants have admitted that they are unable to understand how they are meant to work. This is yet a further example of bureaucratic interference that has wasted the time of our industrialists and business men on completely unnecessary and unproductive work.
If the Prime Minister means what he says when he declares his support for the "I'm Backing Britain" campaign—though does he ever mean what he says?—why does he not introduce some new form of taxation which will provide incentive once again? I mean some simpler form of taxation, for example some form of added value tax, a transference from direct taxation to indirect taxation. This would leave the individual the freedom to spend his money as he wished, and produce a large revenue easier and less costly to collect, thus dispensing with the services of many unnecessary civil servants.
One wonders sometimes whether the mushroom growth of the Civil Service is

not the Prime Minister's secret weapon for dealing with the unemployment problem. I repeat that if he really means that he is backing Britain there is a great deal that he himself can do. He can, for instance, drop some of the legislation that he has in mind for further nationalisation—steel and transport. These measures can only produce inefficiency, waste and extra expense. If he so desired he could cut bureaucracy to a minimum and restore more faith to free people willing to work and make profits not only for themselves but for the country.
That surely is the way to restore our own self-respect, and the respect of other nations will follow. We have to show that we are in business—and we must go on showing it—and that we mean business.

7.2 p.m.

Mr. George Willis: The hon. Member for Bromsgrove (Mr. Dance) read his speech very well. I have no doubt that the propaganda clichés with which he filled it will look very well in his local Press. I am certain that his speech was not primarily intended for this House, nor for this debate, because most of it had very little to do with the Motion. That was a pity, because this is a subject of considerable importance. It is important because the wise use of manpower is important. But the wise use of manpower is not simply a matter for the Government. As was said by my right hon. Friend the Member for Easington (Mr. Shinwell), there are many fields in which some of us feel that a great deal of manpower is wasted.
I am amazed to learn that local government is overstaffed. I always understood that it was understaffed, and that one of the reasons why we are having an inquiry was to examine the need for larger units able to afford the necessary staff of the right calibre. What has been said about government by local authority and what is bureaucratic about it has nothing to do with staffing. It has something to do with the fact that councillors are part time. In the large local authorities this means that officials are left very much to themselves. This in in the nature of things. I have often told friends that 1 should have liked to see an ombudsman for some larger local authorities before there was one for the Government service because there are far more checks upon


the Civil Service nationally than upon local government officials. If there is a point about bureaucracy in local authorities it is not so much in a wastage of manpower, because a great many of them cannot afford the manpower that they should have, but rather in the administration, and that is what should be looked at.
As to the Government service, everyone knows that people tend to be empire builders This applies in business. One appoints a man to do a job, and the first thing he wants is a secretary, and then because he has a secretary he wants a little higher position. This goes on all the time and it is not peculiar to the Government.
An increase in the number of civil servants is inevitable under any Government. There is no political party in this House—Labour, Conservative or Liberal—with a policy which will result in a reduction in the number of civil servants. During the transition from war to peace the number of civil servants certainly fell, but that was because there had been far more controls during war time and the period immediately after the war because of the nature of the task. However, it seems to me that in normal peace time development the number of civil servants must inevitably increase in the same way as the demand for services increases.

Sir Harmar Nicholls: The right hon. Gentleman said that there was empire building in industry, which is true. The big difference is that if it is overdone in industry firms go bankrupt, but if it is overdone in local government it merely means that the rates are put up.

Mr. Willis: I do not necessarily accept that. There is an enormous amount of waste in industry, just as there is anywhere else. All large-scale organisation is inevitably prone to this.
What we have to ask ourselves is not so much whether we have increased the Civil Service as what are the nature of the jobs that it is doing and whether certain jobs are necessary. Having had some experience at the Scottish Office, I would say that the jobs are necessary. On one occasion there was an examination of the number of civil servants employed by the Scottish Office, the

number having risen since we took office. We wanted to ensure that the increase was justified. I found that the biggest increase in my Department was in the prison officer staff. Do hon. Members opposite say that we should reduce the number of prison officers? The fact is that we require more prison accommodation and more prison staff. All prisons in Scotland are overcrowded. Indeed, speeches were made at the weekend about young offenders not having proper accommodation.
Another big increase that I found was in respect of office cleaning. We had taken over a big block of offices in Edinburgh in order to give the civil servants proper working conditions and to enable the work of the Government to be conducted more efficiently than it was being conducted in a dozen or more offices scattered about the city. It is necessary to examine these things and look at the numbers employed.
There has been a big increase because of the setting up of the Land Commission. But the electorate voted to have something done to prevent exploitation in land values. It might be that the policy that we put forward was not the right one, though I think it was. At all events, it was something that the people supported. If we had not done it, hon. Members opposite would have condemned us. That is the kind of double talk that we have from them.

Mr. Tim Fortescue: The right hon. Gentleman's example of office cleaners is extremely pertinent. The offices must, of course, be cleaned, but they need not be cleaned by civil servants. Why should they not be cleaned by office cleaning contractors?

Mr. Willis: It would not make any difference in the long run. We would still be utilising a certain number of people to perform office cleaning. It may seem strange, but people like working for nationalised industries. They like working in Government service. I expect that the hon. Gentleman's constituents will be training their sons and daughters to enter the Civil Service because they like it. It offers a career and many things that private enterprise cannot offer. They know that they will be better treated if employed by the Government than by some cleaning firm, for example.
My right hon. Friends have made enormous changes in our social insurance system and in the distribution of benefits. Does any hon. Member opposite suggest that this should not have been done or that we should return to the previous position and cut down the number of civil servants employed on this work?

Mr. John Page: I am not satisfied that the Ministry of Social Security is utilising its manpower in the best way. If I am lucky enough to be called to speak, I will explain why, with the best possible reasons.

Mr. Willis: In the long term, the number of civil servants will increase under any Government. I do not think that, when it comes to the point, anyone will criticise what has been done out of necessity. We in this House have helped to increase the number of civil servants by our continual demands for White Papers, for specialist committees, for more secretarial assistance and for more people in the Library—for example, to help the hon. Member for Bromsgrove write speeches for his local paper to print, which should be done by the Conservative Party and not by servants of this House.
I have sat on as many Committees considering Bills as any hon. Member and have no doubt made as many speeches. In every Act of Parliament—including Tory Measures as well as our own and perhaps even more so—we find things which must be referred to and approved by the Minister responsible. For example, the Tories—and I do not blame them—say that there must be the right of appeal in so many circumstances. That is a demand of democracy but it also creates a demand for civil servants.
A right of appeal is a democratic process but there is a price to pay for democracy. On the Order Paper every day there are Questions from hon. Members demanding this, that and the other to be done. We are pressed to give local authorities greater power. But what happens? In all the Measures in this House in relation to housing and local government finance and powers in all directions, there are sections stating that certain matters must be approved by the appropriate Minister.
We should look at this in a more level-headed manner. But I agree with the Opposition to the extent that we have to keep a check and see that our organisation and methods teams operate efficiently, that we are getting a proper day's work from those employed and that there is not too much empire building. There will always be empire building—that is only human nature—but it is our job to try and check it. That is a worth while job for Parliament to do.
That is what we should be discussing. We should be considering how to improve the machinery of Government. The Estimates Committee inquires into public expenditure and the first thing it asks for is a list of the people employed in a Department. But I cannot recall any Estimates Committee's Report which begins by recommending a reduction in the staff of a Department. Perhaps the Committee should pay more attention to that aspect. Perhaps there should be more machinery for this in the House. Perhaps the organisation and methods teams of the Treasury should be looked into. But there is also a good system in each Department, at least in the Scottish Office, for checking staff. Perhaps the whole thing should be looked at again, however. I think that all would agree that that should be done and I think that the Treasury would accept it.
But the Motion is nonsense, as are the speeches today from the benches opposite. They are simply a Tory effort to cash in on something popular. [HON. MEMBERS: "Oh."] Of course they are. This is a favourite whipping boy and comes from a paucity of ideas, a lack of policy and a lack of matters on which to attack the Government. They pick on this popular whipping boy, the Civil Service and public money. The Opposition should behave more responsibly. Let them stop talking nonsense and get on to matters which count.

7.12 p.m.

Mr. David Howell: The most notable point in the speech of the hon. Member for Edinburgh, East (Mr. Willis) and in the other speeches from the benches opposite, and what to me is the serious and central point of the debate, is the staggering contrast between those utterances and the high flown policies and undertakings of the Labour


Party in 1963–64. All the talk then was about streamlining government and cutting its cost and about how No. 10 Downing Street was to be a power-house. Now, they are talking about a tentative suggestion that perhaps we should be discussing the machinery of government, with regretful acknowledgement that the Civil Service has elephantiasis, while No. 10 has become instead of a power-house a dog-house, so it seems.
I welcome the debate, which is on a serious and central subject. I disagree with those who claim that it is trivial and superficial. Efficiency of government is near the heart of our problems. The manpower question, though important, is really only a symptom. Below it lie deeper reasons of policy, attitude and organisation in the Departments of the Government and semi-government agencies which have led to a continuous increase in manpower and in costs.
The debate allows us to focus on this deeper problem, as my right hon. and learned Friend the Member for Hexham (Mr. Rippon) began by doing before the debate was diverted. It is important to recognise that the wrong reaction to the situation is to come here, as the Prime Minister did the other day, and say simply, "We will stop the growth of the Civil Service". Given that the work load is increasing all the time and that men of great ability in the Civil Service are working flat out, that is the way to increasing the difficulties rather than reducing them. Simply to demand sweeping cuts across the board at short notice will not help.
It must be right, as my right hon. and learned Friend and others have said, that if we politicians are to propose radical reductions or halts in the growth of public; spending and manpower which it automatically generates, we must cut down activities. It is no use as it were rushing in to hack down a nettle bed hoping that it will not grow again. We have to dig up the roots permanently, and this means diverting people from the public sector into the private sector. We must ensure that it leads to more efficiency in the area of government, as we shall when the Conservative Party returns to office.
Then, politicians and all those in executive authority must face the fact that the traditional methods of financial control

and of auditing performance in this House—with the Treasury, as our watchdog, breathing down the necks of permanent under-secretaries, who, in turn, breathe down the necks of senior officials who breathe down the necks of those lower down the ladder—is not an efficient method. It does not result in more efficiency and less staff. It results in cutting down initiative, and it must be looked at.
The best illustration of the importance of looking at the system is the recent cuts announced by the Prime Minister. A number of policy changes were proposed and a number of forecasts made of future cuts in public expenditure. It is no use saying, "For better or worse, policy changes are at last being made. It is just a question of their being carried out." It is not at all like that. Such changes, like any other policies, are placed upon a Civil Service machine which is wildly overstretched, as every civil servant will confirm. The Civil Service is absurdly overloaded at the centre and it is shrouded in secrecy as a result of over-centralisation, which makes many of us unhappy. Despite the individual initiative of men within the system, it stifles initiative generally.
Against that background, it is useless for hon. Members to say that the thing is bound to go on growing and that nothing much can be done about it. Even worse is to say, "We shall cut down. We shall tell everyone to slash staff." This is merely to prune the edges of a fundamental problem. It is useless to talk of this sort of cut. If we are to have reduction of Government expenditure, we neeed to plan "withdrawals" far beyond anything contemplated by the Government. Far from taking on new responsibilities at this stage or acquiring more little empires—and little empires always grow much more in Government because there is no competitive stimulus—the Government should be looking for ways of shedding responsibility, of devolving and decentralising. These are functions which those who care for efficient Government should be working on rather than saying, "Nothing can be done."
We on this side have been asked what we would do. We have suggested specific areas in which Government activity should cease. For example, the Transport Bill is designed to increase the


area of Government activity and should be reversed. The decision to increase the area of Government intervention in industry should be reversed. There are many ways of bringing private industry in to assist public power and resources in developing public programmes. Hon. Members say that we must have these public programmes—roads, for example. Of course policies have to go on. Roads have to be built. But that does not mean that the taxpayer should have to provide every penny, every resource and every man. Let us go a little further and combine the best in private enterprise and public authorities to provide our motorways, for instance. Why cannot this Government do that? If they had a spark of imagination left in their thinking apparatus, this is the kind of idea they should be studying. Those are some areas, but there are many others where activties could be cut.
The second issue is more fundamental. It is that in the reduced area of government—much more efficient and cost-conscious Government—it should be recognised that the system of control is out of date, as it is recognised first and foremost by civil servants who are acutely aware of it in every main spending Department. The system is designed for a Budget many times smaller than anything which we now have and related to a Civil Service which was simply not asked to undertake the management functions which the present Civil Service is asked to undertake. It is a system which, far from encouraging economies among civil servants, may actually frustrate economies. By treating civil servants as office boys being asked about the tea money, it is made difficult for them to think of new ways of cutting costs and of innovating and of reducing the growth of their Departments and questioning whether they should be carrying out the job and whether the objective which they are trying to achieve is best achieved in the way in which they are doing it.
This is widely recognised in the Civil Service, and it is reflected in the published evidence which we have so far seen going to the Fulton Committee. One of the most important and saddest things of the debate this afternoon is the failure of so many hon. Members, and the need for so many hon. Members, to recognise that

if we in the House are to bring the growth of public expenditure, and, therefore, the growth of the jobs which it automatically generates, back under control, we need to look very closely at the whole question of how we can audit performance instead of looking merely at financial statistics.
This raises very difficult questions for the House and very difficult questions for many who strive to meet it. We should certainly extend the efforts of the Specialist Committees which are looking much more at performance and less at the bare figures. This is a fundamental matter and unless those who aspire to govern are prepared to accept it, to shed prejudice and to recognise the importance of accountability to the House and the fact that the present system promotes inefficiency rather than efficiency, we will not have efficient government, or a system which can do anything but encourage more and more employment and, more important, be the cause of less and less productivity.
As has been said in this debate, a great deal is going on. There are management services in many Departments and outside consultants have been brought in. In a way it is true to say that many of the things which must happen, many of the evolutions and changes in the structure of government to make it a more efficient management organisation, have taken place, but they have taken place rather like grass growing through cement—against the trend of the system.
I believe—and this is what should be the thought behind our debate today—that there is a recognition in the Civil Service that in terms of administration this is the end of an epoch. We have reached the stage at which the Civil Service, which was set up originally as a secretariat, is now called upon to perform colossal management functions and which certainly recognises very fully that this means fundamental changes. It means that decision-making in government, administration and control are moving into a new dimension where far more complex methods are needed. It means that these things should be recognised by those who aspire to govern or carry out policies and see that their aims, whether right or wrong, whether we on this side of the House approve or not, are carried into effect.
Personally, I share the view of those who look forward to the Report of the Fulton Committee, which could be a decisive move forward. I hope that right hon. Gentlemen opposite will divert their energies from various other things, from the working out of codes of discipline and the organisation of their party and other giant strides forward in Socialism, as they are now called, and recognise the essential urgency of the need to create a new system of control of public spending and to bring the House and the Government, but especially the Mouse and thus Parliament, back to the centre of that system. Then we shall have efficient government, but not before.

7.25 p.m.

Mr. William Small: I commend the thinking of tae hon. Member for Guildford (Mr. David Howell) and what he has to say about efficiency in government and the quality of the Civil Service.
I was appalled that the hon. Member for Bromsgrove (Mr. Dance) should have taken the opportunity to denigrate a Minister of the Crown as he did. His pockets must have been full of the small change of discourtesy when he made a personal attack on the Foreign Secretary. The Japanese Ambassador had brought his wife with him and there was a reciprocal arrangement which provided an opportunity for the dialogue to continue, and I see nothing to be lost in a Minister of the Crown being able to continue in a dialogue with the representative of another country in this way. I was shocked by the hon. Member's speech and I say that as one who is not so expert in Parliamentary etiquette as to be able to say something merely for the record. I have given the House my true feelings.
I have listened to all the speeches in the debate and I take the view that hon. Members opposite are now prepared to bid in the market place for quality management and quality people. But if it is necessary for the Government to interest themselves in these things and to take management consultants into their confidence, why should they not employ them direct within the Civil Service?
The argument about nationalisation in politics is now history. What is now going on is large-scale rationalisation. Nobody objects to the mergers involving

A.E.I. with G.E.C., or Elliott Automation, or Leyland Motors—the scheme is such that the bargaining and contracting going on will have a far greater effect on the public purse than has been the case hitherto. I am not willing to say anything derogatory about Ferranti and Hawker-Siddeley, but if we want more effective control of the public purse, then we have to consider the quality of any consultants who are brought in from outside.
As a modern industrial nation, we are being leap-frogged by the Continental countries, by Japan and by Scandinavia and if we are to have a sound economic base and infrastructure, I advise Ministers to think of the need for top quality civil servants. During this lull in recruiting there should be a reorientation within the Civil Service leading to the kind of apex of efficiency which is needed.
Outside Government £75 million is now being spent on retraining in the engineering industry, but a civil servant is needed to say that a boy who has served his apprenticeship and pre-apprenticeship in engineering should have at least 100 sq. ft. of space in which to work. A civil servant is needed to lay down standards of quality in a training establishment.
In the argument between the D.E.A. and the Treasury, I favour the Treasury raising the revenue, but distribution being the responsiblity of the D.E.A., and to that extent the D.E.A. is necessary if we are to maintain and improve our competitive edge against others. The tax yield should go to the Treasury, but the redistribution and the managerial role should be left to the D.E.A.
I have taken stock of our position in the few weekends post-devaluation. I have found that more and more information is required by industrialists, and this will have to come from the Government. This means that we will need more civil servants. We must remember that other people change too. On the Contient there has been the change from the added value tax to the turnover tax. Many industrialists are seeking information from me from the Board of Trade, and other places, in order to have a real opportunity to evaluate a tender. A more intensive recruitment of the Civil Service, of the kind that I have in mind, is necessary, not a reduction.

7.30 p.m.

Mr. John Pardoe: The Financial Secretary referred to "phoney liberalism". I hope that I shall be able to prove to him that I am not in that company, although I apologise to him for the company that one has to keep sometimes, speaking from this side of the House.

Hon. Members: Cross over.

Mr. Pardoe: To say "You have appointed more civil servants than us" is not a very helpful attitude. I had hoped that this would be a debate about ideas and ideologies. Unfortunately it seems that generally ideas count for less and less in political debate today. It is an argument to which Britain has made a great contribution over the years, through Lock, Mill, Green, Hobhouse and others and which is too rarely discussed today. Bureaucracy is not just a matter of counting heads.
Everyone knows that the Civil Service has increased and is increasing. It might be possible to diminish it but there are others who think differently. It is important to distinguish between the two types of increase. There are the new social services, some of which we have supported, while there are others with which we do not agree. Then there is the increase which comes from waste, inefficiency, and empire building.
There are one or two thing which one might put forward to encourage the efficient use of manpower in a Government service. The development of organisation and methods could well be advanced. There is the matter of transferability of pensions. It is extremely important to encourage mobility of labour between the Civil Service and industry. I know of cases that have come to my attention in recent weeks. I know of people who are working in the Civil Service, not fully stretched, doing a job which they would quite like to leave, and offered a substantially higher salary by outside industry. Unfortunately, they cannot go because they are at the wrong age, and it is not worth their while to go without taking their pension with them.
There is the suggestion which we have put forward, that there should be a freeze on the payrolls of all Ministries, and local government departments. This might

cause a little ossification in the Civil Service, but if it was only for a short time it would help. We should allow private enterprise to do far more than is allowed at present, but one of the problems is that if one has an established Civil Service staff one does not have the power to hire and fire. Private enterprise does, and this is the main reason why one does not always find it efficient to employ direct labour.
Several new services have been provided, not all of which we agree with. We fundamentally disagree with the Land Commission, and some of my hon. Friends have managed, by dint of extensive questioning to show that it is operating at a gigantic loss. We have not received any adequate reasons why this should be in being at all. There is another point, and here I direct my remarks not so much at the Government as at the Conservative Opposition.
This refers to the whole question of selectivity in the social services. In his speech during the debate on the cuts the right hon. Member for Enfield, West (Mr. Iain Macleod), speaking from the Conservative Front Bench, opposed what the Chancellor suggested was a new way of ushering selectivity into the social services, on the grounds that it would have been better to have paid greater increases to a small number of poor families. I would merely point out that in order to do this, one would have to employ a vast army of Civil Servants, knocking on doors, filling in forms and asking questions, merely to ascertain people's incomes and their eligibility for these grants.
We do not stem bureaucracy by party slogans. Bureaucracy is a problem of our times. It is the problem of all countries, under all political systems. It operates under Parliamentary democracy, just as much as under dictatorships. To conquer it we have to understand its nature, and the reasons for its development. In theory one can say that bureaucracy is the government of officials responsible only to their chiefs. They are not responsible to the people whose lives their decisions affect. Why does this matter? One could perhaps say that if it brought about increased efficiency then that was a very good argument in favour of it. As a Liberal the answer is that the individual human personality is supremely valuable and it can flourish


only in freedom and true participation in social and individual relationships. Personality is the factor which distinguishes a person from a thing. A person has self-direction and can move, but a thing can be moved only by others. In a democracy, persons are moved about by officials, they do not move themselves. Bureaucracy makes things of all of us, and limits our freedom to develop our personalities.
This is why Liberals want a participating society. Bureaucracy is the very opposite of this. Why has bureaucracy increased in all modern societies? One factor is the complexity of modern society which has increased the whole problem of administration, therefore requiring more people to carry it out.
Another is the general tendency towards centralisation, not only in Government but in business. Another is the overcrowding of our society which is given as an explanation for all sorts of infringements of liberty. A fourth factor is the inadequacy of democratic institutions, and lastly, most dangerous of all, the extraordinary acceptance by ordinary people of this process of growing bureaucracy.
Let me deal with the complexity of modern society. The people to whom the officials are made responsible, their political chiefs, do not understand these complexities and nor do the people they govern. Our sciences and technologies will ensure that there will be a widening gap between those with enough knowledge to make the decisions, and those whom the decisions affect. We obviously need a far greater specialisation of democratic control if we are to deal with this. We already have specialist committees in this House, which illustrates how we can deal with the problem.
The second major factor encouraging the growth of bureaucracy is that of centralisation. I can remember, in one of those books that one sat up all night swotting before the economics degree, there was on one side of the page the dis-economies of large scale, and on the other side the economies. Unfortunately, modern society seems to have remembered only one side of the page, and not the other. I believe that there are considerable dis-economies in large-scale production, and one has only to look at

British Railways and the Coal Board to realise that we have got to the stage where management cannot cope. The problems of administering something as vast and complex as these are beyond mere mortals. The Aberfan Tribunal showed this only too clearly. The other problem of centralisation is that people in government are too far removed from the people they are governing. This again creates an increased bureaucratic tendency.
The third factor which I mentioned was overcrowding. I said that it was used as a defence for almost any kind of infringement of liberty and extension of bureaucracy. It may well be that overcrowding will eventually destroy our society. In "The Naked Ape", Desmond Morris reports on experiments on the overcrowding of monkeys and shows how the whole of their social structure disintegrated. I suspect that this may be happening to us in London and is part and parcel of the reason why our mental hospitals are getting fuller.
Two factors related to overcrowding are town and country planning and traffic management. Here, bureaucracy has run riot. I suppose that the ordinary individual feels that town and country planning legislation infringes his liberty more than almost anything else. Some Questions which I recently asked of the Minister of Housing and Local Government show how long a person has to wait before he can hear the result of his appeal. If he has put in written representations, he has to wait more than half a year—26½weeks was the average time in 1967. This is an intolerable wait. If he has a full-scale inquiry with proper evidence, he has to wait 39 weeks. At the end of it, 78 per cent, of all appeals heard during the period were dismissed.
Traffic management is a classic instance of interference for the sake of interfering. A recent article in the Journal of Transport Economics showed that, with all the paraphernalia and street furniture which we have introduced into traffic management in central London, we have achieved nothing. We have reduced the total capacity for traffic in the centre of London and have not increased the speed at which it moves. Here is an instance of bureaucracy continuing on its course and producing no proper results.
My fourth point concerns the need to reform our democratic institutions. There is no doubt that they are totally inadequate in their ability to control officials. They are also highly unrepresentative. Parliament fails to control the Executive which in its turn fails to control its own officers.
First, we need to devolve vast powers from Whitehall back nearer to the people. We have to break up the pattern of central government. I come from the deep south-west, where we are passionately concerned to involve the local people in the decision-making process. It is immensely important that all parties should realise the tremendous demand and desire of people, particularly of people in the far flung parts of the United Kingdom—what I hope will one day be a federation—to take back these powers to themselves.
The second point in the reform of government is the bringing of more specialist knowledge to the democratic process where it can match the specialist knowledge of the Civil Service. Thirdly, the second Chamber should be reformed on democratic lines. The right hon. Member for Easington (Mr. Shinwell) suggested that we need fewer Members of Parliament. That may be a very good idea. But if we are to have fewer Members of Parliament, it might be sensible to have two Houses sharing the burden of controlling the Executive, the Civil Service and the bureaucracy. This is a personal point. I am not stating party policy. I do not like the idea of any undemocratic Chamber and I should not want to support any reforms which were not democratic in nature.
The fourth point which I would make on the reform of government is that we must make the institutions of government more representative of the people who elect them. This means that we must reform the electoral machine and the electoral system. At present, a large number of right hon. and hon. Members—I am one of them—know that when they look at a bunch of their constituents more than half of them did not vote for them. Many of us are what A. P. Herbert called "non-members": we were elected by fewer than half of our constituents. This is nonsense. If we want representative government, let us

make it representative and let the people's wishes be represented in the democratic institutions.

Sir Harmar Nicholls: I agree if the hon. Gentleman says, "However small the majority".

Mr. Pardoe: There is one great thing to be said for insecure and unsafe seats. I have always believed that safe majorities produce bad Members of Parliament.
I turn now to local government. What is the vital test of local government? Surely it is that people must feel that they have the power to decide their own important questions for themselves—such as what sort of schools they want, what sort of town and country planning they want, and the supervision of their own police. We must remove central control and give the power back to local government. We must reform the whole financial basis of local government and remove the purse strings from Whitehall. This is one way in which Whitehall exercises too bureaucratic a control over local government.
Local councils should be given the power to write their own constitutions. Why should we have one constitution for local government throughout the country? Why not allow local authorities to experiment, as they can in the United States? It would help if the chief citizen of the town were directly elected. This would give him greater power to intervene in bureaucratic decision-making and to represent the people. I would abolish aldermen who are thoroughly entrenched in bureaucracy.

Mr. Harold Lever: Would the hon. Gentleman say how aldermen can be said to be bureaucratic?

Mr. Pardoe: They are not elected; they are appointed. The whole essence of bureaucracy is that the people who are appointed are not responsible to the people whose decisions they affect.

Mr. Willis: We do not have aldermen in Scotland.

Mr. Pardoe: There is a very great danger that in reviewing the size of local government areas we shall concentrate merely on their boundaries and not pay enough attention to reforming the councils themselves. Merely to increase the size of local government areas would be


to exacerbate the bureaucracy which we already see around us.
There is also the problem that the present Government have found. Because of the inadequacy of local government, they have constantly bypassed the local government system and set up regional planning councils, regional road construction units and regional passenger transport authorities. The slogan of the Government seems to be that if an important job is to be done, a new body should be set up to do it; for heaven's sake do not let local government in.
I come to what I call the most dangerous aspect of bureaucracy—that people are beginning to accept greater interference in their lives. State paternalism is getting a hold on us. The attitude seems to be that whenever anything goes wrong the State must provide. This is why bureaucracy has grown. There is a great danger of universal acceptance. In the welfare services there will always be matters to which the Government will have to see and services which the Government will have to provide. If we are to go on extending those services which the Government must provide, there must also be services from which the Government must withdraw. If officials are to go on being given increased powers to interfere in a whole host of services, then bureaucracy will undoubtedly increase and escalate.
Bureaucracy cannot be measured in numbers. We need to discover an entirely new kind of society, a participating society which encourages everyone to play a part in making social decisions, and a distibutivist society which distributes not only wealth but power back to the people. There is a danger that our society in the future will be one in which the individual who is worthy of that title will not want to live.

7.51 p.m.

Mr. George Lawson: I am very glad to follow the hon. Member for Cornwall, North (Mr. Pardoe). I found his speech a welcome change from some of the speeches we have had. It was a serious attempt to deal with a subject which can be treated seriously or which can be treated as a piece of propaganda. I think he will agree with me when I say that certainly some hon. Members on the other side of the House

have treated it as a piece of propaganda and that the Motion itself is primarily a piece of propaganda.
Though I found the hon. Member's speech very interesting, and found in it much with which I agreed, basically I found myself in disagreement with him. It may surprise him that this is so, but basically I found myself in disagreement with him and in disagreement with very much of what is said on this subject, with very much of what is taken as popular opinion on it.
For instance, the term "bureaucracy" has become a term of derision, and I think the hon. Member may have had this in mind. It is a term which is used to express something we are suffering from. Yet, when we look at what has been happening in our society and is still happening in our society, we find that the tendency is the reverse of what is customarily taken as being the truth. It is not new, this thing which people have had to suffer from. For instance, we can go back to Shakespeare's day and to Hamlet's soliloquy when he talks of
the law's delay,
The insolence of office, and the spurns
That patient merit of the unworthy takes,
a long time ago, and there was no State that penetrated or seemingly penetrated into every aspect of life in those days.

Mr. Bence: Give us some Burns.

Mr. Lawson: I am certain I could quote some Burns to that point, but if I were to render Robert Burns as Robert Burns should be rendered, no one here would understand.

Mr. Bence: We would.

Mr. Lawson: Then let us take an illustration, and his very famous theme of The Twa Dogs, which means the two dogs—and I shall interpret no further—The rich man's dug and a puir man's dug. It is the rich man's dug which is wondering all the time—there is a conversation, you see—why it is that the puir folk put up with the things they put up with. It is the puir man's dug which, ironically enough, defends the existing state of things, and the rich man's dug wonders. Here are the lines I have in mind, and I am sure they are the ones my hon. Friend has in mind, where the rich man's dog got so impatient with


the poor man's dog defending the existing order.
Bpt then to see hoo your neglectit, Hoo huffed, and cuffed, and disrespectit.
Lord, man, our gentry care as little for delvers, ditchers and such cattle,
They gang as saucy by puir folk as I wad by a stinkan brock.
I think hon. Members will know well enough what this means.

Mr. Walter Clegg: I think I am following the hon. Gentleman, but was not Robert Burns neither a rich dog nor a poor dog but a Government dog, in that he worked for Customs and Excise?

Mr. Lawson: Not at that time.
The point I am making at this stage is that it is the poor folk, the ordinary folk, who have suffered and have suffered, over the generations, over the thousands of years, wherever we have had what is called civilisation or organised society. They have suffered from the men in power. If I could use a term which, perhaps, I ought not to use, what the people have suffered from more than anything else is being buggered about by somebody in authority.

Mr. Bence: Hear, hear.

Mr. Lawson: It is a Parliamentary term. I submit to this House, and I submit this in all seriousness, that development in recent years has been away from this, so that we suffer less from bureaucracy. Although there are, perhaps, very many more people who may be called bureaucrats, we, the ordinary people, suffer less from bureaucracy than ever we suffered in the past. I am not going to say that this is bound to go on, but up to this present stage that is what has been happening. I say that it is a fallacy, this attitude we have towards bureaucracy; and this is where, though I liked very much of what the hon. Member for Cornwall, North was trying to say, I say he was wrong in his interpretation about what has been happening in our society. Hon. Members opposite, and most people, perhaps, are wrong when they think they think that government is more remote and getting more remote. It is not the case. The Government I support, I say again in all seriousness, were never nearer to the people, though it is not a question of

the particular Government I happen to support; it is a process which has been going on over these past years.
Government has been coming nearer to the people than ever before, and people now are very much more ready to approach the Government officials and people in authority than they would have dared to do in days gone by. My father, for instance, would never have dared to approach his Member of Parliament, and if my father had thought his son would be a Member of Parliament some day, I cannot think what would have happened to him: it was just outside his realm of thinking. The Member of Parliament in those days was remote, a potent figure, remote and away in the distance, to whom one touched one's hat, from whom one walked away backwards. Now we are constantly being confronted by someone such as the fellow who goes into the Labour Exchange and does not get satisfaction, and who says to the official, "I will take this up with my Member of Parliament". He threatens almost everybody with his Member of Parliament. I am constantly getting such complaints from people. Hon. Members on both sides are constantly being approached—being constantly being asked to tackle—almost any question; everything, almost, comes within the range of a Member of Parliament. It is true of Members or Parliament, irrespective of party, that they are rendering a service which used never to be rendered before.

Mr. Bence: Quite right.

Mr. Lawson: We talk about having an Ombudsman, but the ordinary Member of Parliament is an ombudsman; he is rendering services, bringing people into touch with authority. The Member of Parliament can reach the supreme authority in this country quickly. I have done it, and I am sure all of us have done it.
I will tell hon. Members a little story to show how it is possible for extremely high people in the land to be approached. I once received a complaint concerning a handicapped girl in my constituency. She had passed the Civil Service examination with flying colours and was told that a job was available for her. However, the job was in London and I said at the time that it was a piece of nonsense to expect


this handicapped girl to go to London. I approached Mr. Macmillan, the Conservative Prime Minister of the day, and within weeks this lassie was found a job in her own area. In other words, the Prime Minister of Great Britain intervened on behalf of a little girl to put matters right. I have no doubt that other hon. Members could cite examples of representations being made in high places to rectify abuses.
In many ways we are somewhat off the rails in discussing so-called bureaucracy. For example, many people have the idea that decentralisation is the answer to all our problems. My colleagues who represent Scottish constituencies know that I do not want to see Scotland given self-government. I am interested in ensuring that Scotland has a say here, in the British House of Commons. Indeed, many of our fellow English hon. Members need a Scots voice or two to guide them. I want to protect our right to be here and I do not want to be shunted off to anywhere else, not even the Scottish Grand Committee. I want our problems aired right here.
Some people have the idea that, in the interests of democracy, there should be more decentralisation. However, few hon. Members will deny that there is more bureaucracy—perhaps of a somewhat objectionable nature—at the local authority level than there is within the Civil Service. The other day a fellow appeared on television and said that he was the Town Clerk of Tarbolton, no doubt an important place, and that he was paid 5s. a year for his job. I am sure that he is an excellent fellow, but it does not follow that he is any less bureaucratic than a local official receiving many thousands of £s a year.
When we think of what is happening to society generally, we must agree that, whether or not we like it, there is an increasing involvement by the State. This cannot be avoided, even if we say, "Let us shunt this and that off to private enterprise". Private enterprise may do the job, but the State is in control and is greatly involved. The same applies in the United States. Competition is not just between businesses. It is between.States, even in the business of living. We appreciate that we must earn our living. This means that the State must become

involved and see that our youngsters are trained to a standard that compares with anywhere in the world, that our management is as efficient as, and if possible better than, that of other countries and that our techniques are at least abreast of, and, if possible, ahead of, those of other countries. These things cannot be done unless there is a process of increased involvement by the State.
The other side of the coin is to have increased democratisation and sensitivity. In other words, the State must be sensitively in control and not despotic. In the Soviet Union—and the same could be said of Germany a few years ago—this sensitivity does not exist to the same degree. The people are kept down and there is totalitarianism. Perhaps the people will refuse to be kept down one day. I mention that because, with the increased centralisation and involvement on the part of the State that is the present rule in this and most other countries, we must ensure that the State is kept sensitive to the common interest.
This cannot be done by breaking up the various units of Government or by having a great many individuals in this and that area. At the centre there must be a competent means of ensuring that this sensitivity remains and, at the centre, must be people who are genuinely representative of the folk of the nation. These representatives must also be sensitive in their approach and they must be answerable to the people. They must be controllable and, when the folic who elected them consider that they are not doing their job properly, they must be capable of being thrown out.
These representatives must have authority and they must meet in a place such as this. Call it a House of Commons, but whoever they are and wherever they meet, they must be capable of challenging the Government and the Civil Service and of bringing them to book if they are not doing their job properly. Perhaps Select Committees and Specialist Committees can help, but basically the representatives of the people must, like the Government, be sensitive to the common interest.
We cannot escape the fact that while we need a Government at the centre controlling the nation—allowing plenty of scope locally—an effective Opposition


is of the utmost importance. Indeed, I do not believe that our society could function without such an Opposition. When hon. Members talk about controlling the Government, they realise that it is not so much Parliament that does the controlling but the members of an effective Opposition. This means the Government always watching the Opposition, knowing that, should the occasion arise, it can take over and form a Government.
This is competency of professionalism at the centre. The bureaucrats are firmly under the control of a Government who are responsive to the people. And that responsive Government are being constantly watched by the Opposition. The Government must be sensitive and in touch with what is going on—otherwise they will be turned out of office. Knowing this—knowing that, if the people wish, they can turn them out of office—the Government must act sensitively and keep in touch with the people.
It is unfortunate that some hon. Gentlemen opposite are so concerned with working away at hackneyed ideas that they seldom realise that changes are taking place. This is true of people generally; usually our ideas are far behind the changes. Indeed, this is as true of me as of most people. It is truer of some than of others and it is particularly true of hon. Gentlemen opposite. We must appreciate just what the problem is. While the Government should not have too many people doing the jobs that must be done, the matter must be kept in perspective.

Sir Harmar Nicholls: The hon. Gentleman is making a superb speech, but I must bring him down to the level of the debate. He will not say that we are any worse governed today than we were four years ago. Generally speaking, the quality is the same. However, is he aware that for 13 years of Conservative rule the number of people employed in the central bureaucracy went down by 50,000, while in the last three years of Labour Administration the number has gone up by 50,000? That is the level of this debate. Bureaucracy, yes—but not a system which increases the number of civil servants by that amount.

Mr. Lawson: That is not the real point of the debate.

Sir Harmar Nicholls: It is.

Mr. Lawson: It is not, and the words "continued growth of bureaucracy" imply a sneer. Anyone can imply a sneer in the word "bureaucracy". I am dealing with the crucial issue. Hon. Gentlemen opposite are wrong in their interpretation of what is happening in this country—indeed, in the world generally. The sooner we appreciate the facts of life the sooner we will tackle the real problems involved.

8.10 p.m.

Earl of Dalkeith: I have a sneaking admiration for those hon. Members opposite who have drifted in during the afternoon and have tried to put up a spirited defence of what I believe to be an absolutely indefensible case. Only one hon. Member opposite who has spoken was here earlier to hear the magnificent speech of my right hon. and learned Friend the Member for Hexham (Mr. Rippon). Judging by what I have heard them say, the debate would have had more point had they heard him. One thing that has worried me more than anything else that I have heard from the Government benches is the defeatist attitude of hon. Members—an air of the inevitability of the continuing growth of bureaucracy. This is at the bottom of the Government's difficulty, and it is one that they will face increasingly as long as they remain the Government.
I imagine that I am not alone in reaching the conclusion that not many people are happy to pay taxes. Perhaps they do not mind so much if they know that the money is being used for a good cause, but if they believe that it is being squandered or ill-spent, as many members of the public do feel, it is very bad for the country's morale. The taxpayer wants to know whether he is getting value for his money.
Comparisons were made with industry, particularly by my neighbour, the hon. Member for Edinburgh, East (Mr. Willis). He said that big businesses also suffered from inefficiencies of one kind or another which cause waste. That may be true, but the point is that most industries and businesses have to survive in a competitive world and cannot afford to indulge in waste. On the other hand, the Government and the bureaucracy are in a slightly different position. They do not have the


competition that keeps other people on their toes, and they do not have shareholders insisting on the business being managed efficiently.

Mr. Willis: The noble Lord will remember the debates we had in this House a year or two ago, when one of the subjects that was always being referred to was the hoarding of labour by industry. Various forms of poll tax were proposed to prevent industry from hoarding labour.

Earl of Dalkeith: If labour is to be hoarded, I would rather it was hoarded by industry, which will make productive use of it, rather than by Government.
The present growth of bureaucracy is not inevitable. It is very often the direct result of certain policies, some of which we think are very bad and others of which we may support. We should not accept the theory of inevitability, as hon. Members opposite do. Much of the increase is the price we have to pay for Socialism, and in this connection Selective Employment Tax is a good example.
I should like the Government spokesman to give us some idea of the cost of the additional burden the taxpayer has to bear in looking after and supporting the increased number of civil servants we have had since the Government came into power. I have made some calculations. If they are not accurate, I hope that the Minister will furnish us with more accurate figures.
I go on the basis that there are now 54,000 extra civil servants in central Government, and that there are 253,000 people in local government—a figure mentioned by my right hon. and learned Friend. We also have to take into account the number in private industry who have to match the volume of work produced by the civil servants, by way of inquiries, forms, and so on. If we assume that one man has to be employed in industry to match every man in the Civil Service, we get another considerable figure—probably another 50,000. The Minister shakes his head—I hope that he can later tell me that I am wrong.
When calculating the cost, one has to take several figures into account. First, we have salaries and wages. Next, the office equipment provided represents, I understand from a reply to a Parliamentary Question, approximately £135 a head.

I am told that office accommodation is about 15 per cent, of the salary figure. Perhaps most important of all, we have to take into account the loss of productive work by those individuals who are transferred from productive industry into Civil Service. Adding together all these figures, we get the astronomical total of £933,495,500. If the Minister can tell me that such a total is absolute rubbish, I should be only too pleased to hear it, and I hope that he can substitute a more accurate figure.
I want to refer very briefly to Scotland, and I am delighted to see that the Secretary of State for Scotland has come in—no doubt from a very busy day coping with gale damage. We are very pleased to see him. As St. Andrew's House is situated in my constituency, I want to refer to the situation there. I gather that since the right hon. Gentleman took office the Civil Service there has increased to the tune of 1,200, and that the number in Scottish local government has increased by approximately 23,500. These are sizeable increases, and they have no doubt brought with them accommodation problems which call for a great deal of planning. I wonder whether we are getting the new planning needed to provide the necessary accommodation in, the most economical way?
We have St. Andrew's House, and we have a new office block at Gorgie, and the Government now have plans for a huge new complex costing £2½ million right the heart of the Georgian—St. James Square, Edinburgh. That is to accomodate 1,500 people, with a car park for perhaps, 500 cars—230 spaces for staff. That planning will bring extra traffic problems. Instead of having those three places, would it not have been more sensible to plan an overall complex between the city, the Forth Bridge and, say, Turnhouse Airport? That would make planning sense. If that sounds too imaginative to the Secretary for State, would he consider the alternative idea of purchasing the Queen Elizabeth, which I understand is on the market He could moor it in the Firth of Forth and then, if the hon. Lady the Member for Hamilton (Mrs. Ewing), who is not present, had her way, she could always tow it to the Clyde.

The Secretary of State for Scotland (Mr. William Ross): These plans are inherited


plans. They were under consideration when the hon. Member was Parliamentary Private Secretary to the then Secretary of State for Scotland.

Earl of Dalkeith: I do not mind whether they were in herited or not. I can assure the right hon. Gentleman that no one consulted me about this. I would have had a lot to say about if they had done so. And whatever sins there may have been in the past, let us not stick to them now. I am all for breaking away from them.
There are rumours of odd things happening in Cumbernauld, in respect of offices specially to cope with S.E.T. There are rumours of people being paid for an office that has been built too big, involving a great deal of the taxpayer's money. I should like to be told what is going on there.
I make two suggestions to try to cope with the problems as I see them. It is not good enough to aim simply to contain the growth of bureaucracy. We must aim to introduce cuts and reductions by transferring civil servants to productive industry. Practically all big industries and businesses do not hesitate to make use of business consultancy and business efficiency firms to advise them. I see no stigma attaching to this. I see no reason why the Civil Service should not use outside business consultants. My respect for the Roman Catholic Church was greatly enhanced when it underwent this sort of examination. I was most interested when it came out equal to Standard Oil, New Jersey.
Although I have the highest regard and admiration for our Civil Service, which I think is the finest in the world—I am not saying that because one in four of my constituents are civil servants, but because I genuinely believe it—I believe our best civil servants are as anxious as we are over this problem.

Mr. A. Woodburn: The hon. Member may be interested to know that when I had this responsibility I did what he has suggested. I invited a number of businessmen to examine the whole of the Scottish Office to find where was the waste of which the Opposition complains. The businessmen were quite unable to find any waste, and their report suggested

that the Scottish Office was run most efficiently. We built into the Civil Service at that time organisation and methods departments whose business it is to examine the staffing of the Civil Service and to help to find where there is overlapping between local and central government.

Earl of Dalkeith: I was most interested to hear what the right hon. Member has said, but the time to which he has referred was long ago in the mists of time. Since then great strides have been made in the business world in developing this idea of business efficiency and examination. I do not believe it is impossible to make a great many improvements now.
My other suggestion, which I hope may be regarded as one of the most constructive suggestions to emerge from this place for some time, I put forward with all humility. It is a suggestion which I think is applicable to all Governments irrespective of party, but more particularly apt at present to this Government who appear to see some virtue in solving appalling economic problems by increasing the army of officials, and, of course, also by migration. I dread to think what the unemployment figures would be today but for the 361,000 increase in local and central government civil servants.
I am sure all would agree that the one body which has a greater power to make democracy work sensibly than anything else is the free Press. I suggest that the newspaper editors should get together in conference and decide among themselves to organise a national war on waste to be known as "W.O.W." This should include local and national newspaper proprietors and editors. Every one of us know of examples of waste in the Civil Service which may be trivial or big. Sometimes these cases are reported by constituents, but more often than not people shrug their shoulders and ask, "What can we do about it?" We all know of dozens of such cases. Cumulatively they add up to tens of millions of pounds worth of waste going on every day. No one gets down to the job of tackling this.
I suggest that the newspapers should carry out a war on waste campaign. It


would be for them to work out the details. Each newspaper could have a weekly column explaining where waste is taking place and it could invite readers to describe specific examples. The editors would themselves investigate the various complaints, verify them, and try to establish the cost of them. At the end of a month the total could be published. This should be judged by a panel of judges who would decide who was the winner. The Government would pay the editor of that newspaper £1,000, tax free, as a prize. This would amount to only £12,000 a year but it could bring about savings of anything up to £120 million a year in cutting out waste. The Press is the only organisation with the power and the ability to do this.

Mr. Emrys Hughes: Would the noble Lord agree that £9,000 a week spent on the Royal Yacht is wasted? Would that win one of the prizes in his competition?

Earl of Dalkeith: The hon. Member may or may not be one of the judges appointed to the panel, but I am not at all sure that whoever the judges may be they would necessarily agree with his views about whether money spent on the Royal Yacht was wasted or was an extremely good investment, one of the last remaining examples of prestige which this country has. I hope the Government will do their best to support some vestige of self-respect in this country.
In deploring the growth of bureaucracy, I also express disappointment at the performance of the last Government in not pruning the Civil Service a great deal more than they did. But to look at the achievement of the present Government by which they have made the Civil Service our biggest growth industry, is agonising. For this reason, I have the greatest pleasure in supporting the Motion in the names of my right hon. Friends.

8.27 p.m.

Mr. Cyril Bence: I was amazed at the statement by the hon. Member for Edinburgh, North (Earl of Dalkeith) that if labour were to be hoarded he would prefer that it should be hoarded by private industry rather than the State.

Earl of Dalkeith: I suggested that there would be capable of being put to some productive use.

Mr. Bence: When one hoards something one does not keep it in use, but hoards it in case it may be wanted. When I first came to this House some of the first Questions I put to the Minister of Labour were about hoarding of labour by industry. Certain industries had tremendous amounts of skilled labour and had extensive lobbies in their support. That was true of the aircraft industry which has the finest lobby of any industry and which has fought against the cancellation of aircraft and things like that. It has always had a tremendous amount of available labour for its use.
I should be the last to agree that every man on the employment rôle, whether in the Civil Service or in private industry, should always for eight hours a day be doing a job. Industry must carry spare labour, to cope with emergencies and for all sorts of reasons. It must carry skilled men for breakdowns. It just cannot run its production machine 100 per cent, full-out with all its labour force employed. In every function, no matter what it is, labour must be available for emergencies of all kinds, whether in a small enterprise or a large enterprise, whether in the State sector or in private industry. When talking about bureaucracy and the growth of manpower in the Civil Service, it should be remembered that there has been a growth in manpower in practically every industry.
This is the unfairness of this Motion, because looking back over the last 40 years, notwithstanding automation, not-withstanding all the latest technical and scientific devices, notwithstanding all the consultants, there has been a growth in ever department of industry, whether on the production side or anywhere else. Even with automation and all the latest techniques of mass production, today there is more labour on the production side than there was 3 years ago. This is an alarming fact. What I object to about the Motion is that one would imagine that it is only in the Civil Service that there has been a growth of manpower.
I was a member of the Estimates Committee for many years. I resigned from it a few years ago. I was Chairman of one of its sub-committees. One year we examined the Ministry of Pensions and National Insurance, as it then was, now the Ministry of Social Security. We


went to Newcastle and Norwich. We visited various institutions. We examined witnesses, including some from employers, and we were told all along the line that the sheer efficiency of the institution at Newcastle, its techniques of keeping records, its techniques of franking stamps by large industrial units, saved industry hundreds of thousands of man-hours per annum. In other words, the efficiency of the Civil Service saved manpower for private industry.
I was also on the sub-committee when we dealt with roads, under the Ministry of Transport. Again we were told that the efficiency of that Department saved thousands of man-hours in private industry, because the work that should have been done or which could have been done by private industry was done in the Civil Service, thereby saving private enterprise labour.
I remember going to a function when the Tory Government were talking about the reorganisation of the shipping industry. The Shipping Industry Board was established at a later date. At that function the chairman of one of our great shipbuilding companies spoke, and 1 was astounded by what he said. I have a lot of sympathy with the remark of the hon. Member for Cornwall, North (Mr. Pardoe) to the effect that there is too much of the attitude in Britain, when anything goes wrong, of looking to somebody else to put it right. I accept that. If there is such a thing as an English disease, that is it. If there is something wrong, the other fellow must put it right. As an example, there was a complaint that the snow was not cleared away fast enough in a certain small town, and somebody said "how could you expect the fellows to come out and clear the snow away if nobody had cleared it away for them to get there?" This was said facetiously, but if illustrates the point.
To return to that function, the chairman of one of our biggest consortiums said seriously, in an after-dinner speech, "What we are now waiting for is the establishment of the Shipping Industry Board and the appointment of a chairman so that we shall have someone to whom we can take our troubles". British industry since 1939 has been taking its troubles to Departments of the

State. The British Civil Service has given more assistance to British industry since 1945 than the civil service of any industrial nation in the world.

Mr. A. Woodbum: Including agriculture.

Mr. Bence: Every industrialist abroad, every great competitor abroad, complains regularly that the British industrial complex has more Government support and technical advice than that given in any other industrial nation. I remember very well, as will all hon. Members who have been here a long time, than when the Labour Party was in opposition whenever the Foreign Secretary was at the Dispatch Box those connected with exporting industries, having first declared their interest, complained that our embassies were staffed by the wrong sort of people.
There was pressure for more scientists, more technicians, more people to advise our exporters. This is what some Tory Members wanted. The right hon. and learned Member for Hexham (Mr. Rippon) knows that as well as I do. It is no exaggeration. We in the Labour Party supported it. We, too, were fed up with the old school tie in the embassies. We wanted technicians and accountants to be available in out; embassies all over the world to help and advise British exporters. The Board of Trade today employs a vast staff of experts to help small exporters to export. If it were not for those staffs, exports would be cut by about 6 per cent, because the little man would not be able to find his way in the complex of export trade. Therefore, I say: stop this knocking of the civil servants by the very people who are sent here to represent commercial interests and who in the past were always looking to the Civil Service for guidance and help, which they get—very expert help indeed.
I remember when the Ferranti case was debated here. What was the excuse from the then Government? It was very simple, that they never had the staff. When we asked why they could not get the staff, they said they try to recruit them but that they could not get them. The same people who were complaining about our failure to recruit civil servants now complain that the Government have too many. We cannot win.
The hon. Member for Liverpool, Garston (Mr. Fortescue) said there would


be a great saving to the national economy if all the "Mrs. Mopps" were taken out of Government service and employed by private enterprise to do the same job.

Mr. Fortescue: I resent and deny the suggestion that there was any commercial interest in my intervention. There was none, and I hope the hon. Member will withdraw his suggestion.

Mr. Bence: Yes.

Mr. Fortescue: I am obliged to the hon. Gentleman. There are many office cleaning firms which compete for contracts to clean these big buildings and the job is done far more cheaply and efficiently by these firms than by the Civil Service.

Mr. Bence: Those firms may pay lower wages to the people who are employed to do the job, but the fact is that the same sort of manpower is being employed to do the same job but is being given a lower standard of living. I am supporting the institution that employs people to do a job and gives them a decent standard of living for doing it.
I remember protesting in 1952 and 1953 about the waste of money on the Royal Yacht "Britannia". There were more admirals than ships. The admirals were coming up from Portsmouth to Clydebank to put blue and red chalk marks on various parts of the Royal Yacht to indicate where it should be altered. The cost of the alterations amounted to £330,000. In my election campaign I referred to this as a shocking waste. I said there was an awful lot of waste because the admirals in Portsmouth had nothing better to do. Had we had a Labour Government then, they might have found these admirals something better to do.
My Conservative opponent said that in complaining about this waste of money on the Royal Yacht "Britannia" I was objecting to my constituents earning good wages. This has always been Tory philosophy. If the State spends money by which some big industrialist makes a packet of money, that is good expenditure by the State. That is not money down the drain. That is money going into a good channel. But if the State spends money that provides for ordinary common people to enjoy some of the

extra amenities of life, then they say it is a waste of resources. This is the general attitude of the party opposite, and has been for years. I do not say that some of the young Members, on the benches opposite are like that today, but there is that overhang from the past among their colleagues. The hon. Member for Bromsgrove (Mr. Dance) is the sort of chap who preaches that sort of philosophy. It wells up in him.
We on these benches accept that the State has to intervene to an ever greater extent in the nation's activities. We have had complaints—I have been disgusted by some of them—against the Ministry of Agriculture in connection with foot-and-mouth disease. We have been asked why the Ministry has not got more vets, more centres and more inspectors, and about the lack of Ministry facilities all over the country. We have complaints from the party opposite that the Government have not provided all the expertise in the various Departments to watch over the difficulties and problems which we face, and then, at the same time, we have this sort of Motion on the Order Paper to cut down the manpower of the Civil Service.
I was shocked when I heard the noble Lord the Member for Edinburgh, North accuse the Civil Service of squandering money. This is a reflection on Parliament. We have our all-party Public Accounts and Estimates Committees. If any money is squandered during the year by any Department of State, it is against all of us in Parliament, not the Government, that the Motion should be directed. I have never known an Estimates Committee—I sat on it for years—report to the House that the Government had been squandering money. Most Reports of the Estimates Committee—I was responsible for two from a sub-committee myself—complain that Departments have not done enough. The answer we get from the Departments is that they have not got the staff and they cannot get them. Tory Members have accepted this. I have never known them to revolt against it. So the noble Lord should not use such language.

Earl of Dalkeith: When the hon. Gentleman reads my speech, he will see that he has misrepresented what I said. I said that a great many people nowadays are concerned because they are not getting value for money and they feel that some


money is being squandered. This is the result of Government policies. It is not done by the Civil Service.

Mr. Bence: When I speak in the House, I say what I think, not what other people think outside. I take responsibility for what I say, but the noble Lord, when he is challenged on statements he makes, says that he is misquoted and that he was reporting what people say outside. This is merely a way to escape responsibility for his own statements. It is what the noble Lord says and what I say that matters. The noble Lord, like a good many other people, unfortunately, always looks to the other chap. It is the other chap who must do it. I do not believe in that. I believe in taking responsibility.
The party opposite has always been prepared, and will be prepared, if returned to power, to use the financial resources of the nation, irrespective of whether it would lead to a growth in the Civil Service, to support an economic structure which would bring the maximum benefit to the people whom it thinks should get that benefit. All right. That is what the Tories believe in. I believe in a Government who will use the resources of the nation to the maximum effect to bring the greatest measure of prosperity, happiness and stability to the people who make the greatest contribution in the distribution of the nation's wealth—and that is not the stockbrokers of the City of London.

8.43 p.m.

Mr. Cranley Onslow: Sometimes, I feel that we can be grateful to the hon. Member for Dunbartonshire, East (Mr. Bence) for one thing—for reminding us how little we shall miss him.
I welcome this debate, unlike hon. Members opposite, because I regard this as a matter which is causing great public concern and which, above all things, ought to be debated in the House. I suppose that I can claim to be, in some respects, a pioneer in the pursuit of statistics about bureaucracy. Looking back, I find that I put my first series of Questions down on the subject as long ago as April, 1965. I have put a good many Questions down since then, and I am not repentant about the cost involved because it is information which

the Government of the day should have to hand, should be prepared to give the House and should not find themselves paying additional money to collect.
The situation that has developed since October, 1964, is, briefly, that in their first year of office the Government succeeded in increasing the number of non-industrial civil servants by 8,000, which, when it became known, was—and those were the days—headline news. They achieved that rate of striking, which took a year when they were first in power, in a single quarter last year. Between July and October, 1967, non-industrial civil servants increased by over 9,000. There has now been a total increase of 54,000 in non-industrial civil servants, and a total annual extra cost to the taxpayer of £120 million in annual staff costs alone. The annual cost of a single non-industrial civil servant has increased from £1,280 to £1,530, while the non-industrial staffs of the nationalised industries have increased in the past three years by 25,000, at an extra annual cost of £120 million.

Mr. Woodburn: Mr. Woodburn rose——

Mr. Onslow: I will not give way.
Those figures define the dimensions of the problem. I am not convinced by the professions we have heard that we can now expect to see a halt called to the increase. As usual, we must read the small print in the statements about holding the numbers of civil servants at the level where they will be at April this year.
The Answer I received to a Question I put recently to the Financial Secretary to the Treasury about reductions in industrial staffs indicates clearly that the Government have the capacity and the intention to continue to increase the numbers of non-industrial civil servants, but to fiddle the statistics by a cutting-down on the industrial side. It would be a remarkable achievement if the Government could maintain their policies and hold the numbers of non-industrial civil servants at the level they are now. It is an achievement beyond their powers, and I expect the number of non-industrial civil servants to increase by the end of next year by at least another 10,000.
This is bureaucratic dropsy. It afflicts our whole body politic. We should not


be surprised, because bureaucracy and Socialism are inseparable. Because this is so, hon. Members opposite have accepted and welcomed what they regard as the inevitable increase in the size of the Civil Service. To them it is inevitable, indeed desirable, that the body politic should become so bloated and swollen as we see it today.
It may be true that in our time in Government we increased the number of civil servants. I should say that we were wrong in many respects, and I hope and believe that when we return to office we shall succeed in cutting staffs to at least as low a level as that prevailing in 1964.
Since this is a debate about bureaucracy, it is about something which touches the lives of every single one of our constituents in one way or other. When I heard that we were to have the debate. I went through my current mailbag and found, without much difficulty, a number of examples of bureaucratic nonsense. Any hon. Member could have done the same. I shall not cite them all, but one or two may illustrate the relevance of the situation to the ordinary member of the public.
He sees the Government creating bureaucracy but not using it. The South-East Regional Economic Planning Council was not consulted over Stansted, that prime example of bureaucratic nonsense. He also sees the Council bringing out, with a great flourish of trumpets, a Strategy for the South-East in which certain projections are made about military lands in the area, yet we now know that no forward advice was given by the Ministry of Defence to the Council on which it could base an intelligent decision.
He sees statistics collected in the most curious way so that, for example, if hon. Members want to ask a question about the number of emigrants from this country and their professional qualifications they must address themselves to the Minister of Health, because the General Register Office comes under him for Parliamentary purposes.
He sees one Ministry refusing to take decisions which would save another Ministry money. One of my constituents had a leg off above the knee and could not go to work. He was obliged to draw £14 a week from the Ministry of Social Security because the Ministry of Health

would not pay £37 to give him even a temporary conversion which would have enabled him to drive his own car to work. This is an illustration of money being thrown away because a Ministry is too short-sighted to take a decision which would save the Exchequer.
A doctor called out at night has to fill in a form to claim the magnificent fee of 7s. 6d., which is smaller than the 13s. 4d. quoted by my hon. Friend the Member for Walsall, South (Sir H. d'Avigdor-Goldsmid). If we are to institute a bureaucratic system to claim 7s. 6d. back we are reaching the point of absurdity, and it would be much more sensible to entitle doctors to an allowance. All the doctors that I know are honourable men, and I do not think they would abuse such a confidence.
When that Socialist bastille, the County Hall, was finally stormed by the Tories it was found that the G.L.C. architect's department used 1,000 forms—one department. Now we are working to rationalise the situation. This is an example of the end product of a long period of Socialist rule. Wherever we go we are beset with paper. When we open our postbag we find that 50 per cent, of it can be thrown away, and 50 per cent, of what we throw away comes from some governmental agency. Hon. Members will recently have received a letter from the Home-Grown Cereals Authority telling them:
Your name has been placed on our free mailing list and we will send you future copies as published.
of some journal that they have produced to do with the growing of cereals. If I were offered £1 for every field of barley in my constituency I should not be very much richer. I do not suppose that many hon. Members maintain a close constituency interest in cereals, though some undoubtedly do. That indiscriminate mailing of large, expensive publications is a typical example of bureaucracy running riot.
I return to the general proposition that the growth of bureaucracy is bad. We know this to be so, and for a number of reasons which ought to be clearly defined. Bureaucracy is self-perpetuating and monopolistic. We know the story of the French civil servant who was asked what he did and said "From 9 to 12 I work and for the rest of the day


I defend my position." This situation is common to bureaucracy at large unless it is under pressure to economise in staff and money. The costs are excessive. There is no doubt that great waste is involved in terms of manpower and money. Decisions centralised in this way and taken remotely are far more likely to be wrong and the consequences of their being wrong are far more serious than decisions which are left to individuals to take in the light of their judgment and first-hand knowledge.
Finally, and most serious, the bigger bureaucracy becomes the more remote its workings are and the more difficult it is to call them to account. We in the House of Commons should be the first to recognise this, and hon. Gentlemen oposite who have been on the Estimates Committee should know better than to say what they have done.
It seems to me that a characteristic of this debate has been the inability of the Government to debate the motion. What they have set out to do is what the corvettes on the Russian convoys were obliged to do during the war, so it was said, and that was to make smoke and submerge. The Government have had no answer to this debate, and therefore, they have sought throughout to hide behind a smoke screen. The pace was set by the Financial Secretary. Then we had the great smoke pots of the Government back benches brought in, such as the right hon. Members for Easington (Mr. Shinwell) and Leeds, West (Mr. C. Pannell)—a cluster of speakers calculated to make Vesuvius look like a smokeless zone. They puffed up clouds of thick, dark smoke, while the Government retreated behind it. It is crystal clear that the Government did not wish the Motion to be debated.
If I might answer the right hon. Member for Easington, who is now no doubt smoking in some other corner, it is possible and, indeed, desirable to set a target for a reduction in the number of civil servants on the non-industrial side of at least 50,000 within three years. It will not be necessary to sack a very large number of civil servants because in any case the Civil Service is much under establishment—some 3 per cent, on average—and natural wastage will reduce

the numbers in the normal course of events.
It has been suggested on the Government benches that we are attacking the Civil Service. I resent this line. I was a civil servant and I have a great many friends and constituents in the Civil Service. Although I made my contribution to reducing its size some time ago I still keep in touch with my friends there. I will spare the Government benches the confidences that my friends have given me, but I can assure the Government that the unease about the state of the Civil Service is concentrated mostly in the Civil Service. Civil servants know how their efficiency is being lowered, how inefficient people are being promoted and the complexity of Ministerial emboggle-ment—the only word I can think of—which is bringing the machine grinding to a halt in the Inland Revenue and elsewhere. If the Government benches tell us that we must not criticise, they are very wrong indeed to do so.
I do not blame in this context the Financial Secretary and the ex-Financial Secretary who sit in such splendid isolation on the Government Front Bench, though accompanied from time to time by the Secretary of State for Scotland. We know these two Ministers. We like them in their way. They are the Rosencrantz and Guildenstern of the Treasury Bench. They have failed to answer the debate, and in due course they will go the way of Rosencrantz and Guildenstern. There are guilty persons who are not present on the Government Front Bench, such as the Leader of the House, who has suddenly taken to military metaphors, propounding the ingenious doctrine that an army must have certain serious setbacks on certain parts of its front in order to achieve success elsewhere.
No doubt we shall shortly be hearing from the right hon. Gentleman that the Government have really only been withdrawing to previously prepared positions and no doubt that statement will carry about as much conviction as it did in 1940 and thereafter. It is he and the Prime Minister who are the real architects of the sad situation to which the Civil Service has been brought. I have questioned the Prime Minister on the subject from time to time. In November, 1965, I asked what instructions he had


given to Members of the Government to reduce the size of their Departments. He replied:
My right hon. Friend the Chancellor of the Exchequer has asked Departments to review their staffs in order to achieve the maximum economy."—[OFFICIAL REPORT, 25th November, 1965; Vol. 721, c. 753.]
I asked him the same question a year later, when the reply was:
Ministers in charge of Departments are well aware of the importance of manpower economy, but some increases in staffs are necessary to implement recent legislation."—["OFFICIAL REPORT, 15th November, 1966; Vol. 736, c. 222.]
I did not ask again in 1967; I did not want to embarrass the poor fellow.
Ever since 1964, we have had Socialism and bureaucracy marching hand in hand and, most serious, the quality of the Civil Service declining. The Government should know—it should not be necessary to remind them—that devaluation is caused by inflation and loss of confidence. This is true both in terms of the national economy and in terms of human organisation. By this Government, by Socialism, the Civil Service has been inflated. It has lost confidence in itself and the country is losing confidence in it. It has been devalued and for that above all the Government richly deserve to be censured.

8.58 p.m.

Mr. Patrick Jenkin: It is a strange and possibly haunting occasion to find myself once again facing both the Financial Secretary and his predecessor in a debate. The Financial Secretary's speech was uncharacteristic and consisted, so far as I could ascertain, in part of accusing my right hon. and learned Friend the Member for Hexham (Mr. Rippon) of making points which he did not make, in part of accusing the Opposition of displaying attitudes which we did not display, and in part of complacency about the nature of the problem we axe discussing—a complacency which I found as disturbing as, coming from him, it was surprising.
For the record, I make it clear at the outset that I do not intend and do not wish to make any attack on the industry, devotion to duty, skill, loyalty and integrity of any single civil servant. The Civil Service, is, in a sense, the subject

of the Motion of censure, but our attack is on the Government, on Ministers for a supine attitude to the problem and on their policies for leading, as they have done and as was inevitable, to a proliferation in the number of officials which, as has been said, is merely a symptom of a problem which goes much deeper.
Perhaps I may recall briefly some of the basic figures, because there have been one or two misrepresentations. On Friday, the Financial Secretary told the House that there has been an increase in the number of non-industrial civil servants, excluding the Post Office, of 54,000 in the last three years, an increase of more than one-eighth. By any standard, this must give ground for concern. The hon. Gentleman attempted to argue that the Conservative Government were equally guilty, but this is not so. During the period from 1951 to 1964, the number declined by 11,000, although the total population of the country increased by 4 million, the working population by 2 million and there were also other increases.
The hon. Gentleman also attempted to argue that there were bound to be increases in the number of civil servants as people achieved a higher standard of living and life became more refined. Let us look at one of the aspects of public activity he mentioned—education and welfare. During our period of 13 years, the school population increased by 23 per cent., the university population went up by 66 per cent, and the number of retirement pensioners by 49 per cent. Yet during this period the Conservative Government reduced the number of public servants.
The hon. Gentleman will argue that this is only a half truth because one must divide the 13 years into two periods—up to 1959–60 and thereafter. It is true that there was a substantial reduction in the first eight years and then an increase over the last five, but even if one takes the last three years of Conservative rule the record is markedly better than that of the present Government. During our period of office, the increase was about 25,000—less than half the increase since October 1964, and the period 1962 to 1964 was one of rapidly accelerating economic growth, whereas the last three years has been a period of stagnation.

Mr. Woodburn: Does not the hon. Gentleman agree that during the first period after 1951 the Conservative Government were still dismantling a great many of the war services which had been going on since the end of the war?

Mr. Jenkin: Of course, I agree. Exactly that. But the reduction went on for eight years right up to 1959, and that represented sound administration.
I concede that the Government can point to one genuine excuse which is peculiar to them and which hardly touched Conservative rule, and that is the problem of rising unemployment, because it is a fact that for every 100 men out of work the Ministry of Labour needs to recruit one extra civil servant. No doubt that is why the Ministry of Labour has shown one of the most staggering increases of any Ministry in the last three years, from 20,500 in 1965 to 28.800 in October 1967, an increase of 40 per cent.
I concede at once that it is not entirely due to rising unemployment. The Ministry of Labour has had to take on board the Selective Employment Tax as well. Perhaps the House will recall that anguished cri de coeur of the manager of a Midlands employment exchange at the time of the motor car industry redundancies following the measures of 20th July, 1966, when he was quoted in the Press as saying:
These redundancies could not have come at a worse time for us just when we are having to cope with the introduction of S.E.T.
I am bound to say that it would be difficult to devise a more apt comment on the follies of Socialist Government.
Part of the expansion of the Civil Service has come from the establishment of new Ministries, such as the Department of Economic Affairs, the Ministry of Technology, the Ministry of Overseas Development and, if one can recall it, the Ministry of Land and Natural Resources, which had a sort of boat race career—in out, in out—and we also have had new boards such as the Prices and Incomes Board, the Industrial Reorganisation Commission and the Land Commission.
Some of these have taken over functions, and with them staff, from existing Ministries, but many of the people who

staff these new Ministries and Boards have had to be recruited from outside. I was intrigued to read in the Financial Times an article last year saying that the Department of Economic Affairs had had to look outside for its clerical staff and was fortunate enough to have a sausage factory closing down, many of whose staff were happy to enter Government service.
While, clearly, outside recruiting to new Ministries will create an expansion of the Civil Service, the astonishing thing is that this seems also to happen when existing Ministries have transferred functions, or merged, or even when they have wholly disappeared. On every occasion the numbers after a merger have been larger for the two Departments merged than was the combined figure before. This happened when the Foreign Office and the Commonwealth Relations Office were formed to form the Diplomatic Service, and it happened when the Shipping Division went from the Ministry of Transport to the Board of Trade and when the Ministry of Aviation was divided between the Ministry of Technology and the Board of Trade. It also happened when the Ministries of Pensions and National Insurance were combined to form the Ministry of Social Security.
Of course, I do not contend that the mergers were the sole cause of this inflation of the bureaucracy. In many cases, as the right hon. Lady the former Minister of Social Security reminded us, these Ministries took on new and expanded functions, but, despite that, there seems to be a remarkable co-relation between movement and growth, and it seems that the mere process of reorganisation somehow stimulates growth, rather as some garden shrubs tend to thrive on transplantation.
Contrary to what happens in the world outside where when there is a shake-up it usually results in a shake-out, in the Civil Service we have this curious dance, the "shake-in". And so we get the worst of both worlds. When new Departments like the Land Commission are formed, the numbers of civil servants increase to fill the new posts, while when old Departments merge the numbers still expand. It is small wonder that in the Civil Service Commission Annual Reports there is betrayed what one commentator, writing in the Financial Times,


described as a "note of helplessness". But it would be wrong to think that that note of helplessness springs from an inability to stem growth, because that is not the function of the Commissioners; it comes from a failure to recruit enough. Year after year the reports indicate that the Departments are unable to fill the demands put upon them.
In the Financial Times it was written:
Precise figures on how far below strength the Civil Service is are impossible to find. As one Ministry put it 'We know we are under strength but until we get more people we won't know by how much'.
Many hon. Members on the other side of the House have remarked on the fact that Committees of this House, such as the P.A.C. and the Estimates Committee frequently refer to a shortage of staff. In the September, 1966, P.A.C. Report there was recorded a shortage of 100 technical cost officers in the Ministry of Aviation. There is a great shortage in the Inland Revenue and when the new P.A.Y.E. codes had to be worked out, on the increase of pensions, 400,000 hours of overtime were worked. The Civil Service Commission is now advertising at the rate of £300,000 a year. The problem is formidable by any standards. The debate has shown up some very interesting reasons for the growth, and many of my hon. Friends, and even one or two hon. Members opposite, have made some suggestions as to how this might be remedied. These can be usefully discussed under three heads, methods, measures and men. I propose to say a few words about each.
First, methods. This was a subject which my hon. Friend the Member for Guildford (Mr. David Howell), who told me he was not able to stay for the winding-up speeches, discussed, and of which he obviously has a very profound knowledge. By methods I mean the use of tried and accepted methods of achieving optimum results from minimum cost and effort.
There are two preliminary points to be made, and it is these which have been missing from so many of the speeches on the Government side. Any valid system of the optimisation of results depends primarily on the measuring of output, measuring the work produced. In administrative work, especially in work of senior administrative officials, this is

extremely difficult. The second point is that hard as it is for any Department to do this, it is almost impossible for a body such as this House, or any of its Committees to do. Our function is to check the Executive. It is one of the most important functions that we have. But we really cannot carry out a proper, efficiency audit of Government Departments. What we can do is to see that there is built into the system an effective machinery with the very best of modern management techniques, and to see that it is not only available, but regularly used as a matter of course.
This is the essence of the type of campaign which is summed up in the slogan "War on Waste". This is a war we ought to begin immediately. The right hon. and learned Member for Hexham apologised for the Americanese which one is bound to use in this context, but the Americans have invented these techniques and we must use their terms. Every Department must be given a Cost Reduction Programme, with cost reduction targets, subject to regular reviews, with savings proved and verified. These Departmental programmes must be backed up by a central Cost Effectiveness Department.
This must be part of the Prime Minister's Office. Although on this we must await for the report of the Fulton Committee, I have been very impressed by the volume of support from within Whitehall, from former senior civil servants, for the suggestion that the responsibility of the management of the Civil Service should be taken away from the Treasury and placed under the Prime Minister. Lord Redcliffe-Maud, Sir John Maud, as he then was, writing in the Daily Telegraph last year said:
I would relieve the Treasury of its managerial work. I would convert the Cabinet Office into a real Prime Minister's Department responsible for servicing the Cabinet, overseeing the machinery of government, and managing the Civil Service.
This can be echoed by any number of senior civil servants. Whether or not this view is accepted, there still must be a Cost Effectiveness Department, and this can and should be set up now under the Prime Minister. Its prime task would be to ensure that every limb of Government adopted the new management techniques. It would carry out feasibility studies of


all major Government projects. It would develop new techniques for evaluating performance and for controlling and managing Government projects. What is required is what the Sunday Times called in a recent article
A massive effort to modernise the technology of Government
I am bound to say that we see very little evidence of this on the Treasury Bench.
Indeed, we are as good as told that there is no real need for it. In a recent Question put by my hon. Friend the Member for Aldershot (Sir E. Errington), the Chancellor of the Exchequer was asked whether he would enquire
as to the effectiveness of the arrangements for furthering efficiency in Government Departments …
The Chief Secretary answered:
These arrangements are kept under continuous review and special inquiries are unnecessary. Each Department is responsible for its own efficiency and obtains advice from its Organisation and Methods branch, the Treasury and consultants, as appropriate"—[OFFICIAL REPORT, 19th December, 1967; Vol. 756, c. 357.]
That just is not good enough. Everybody knows that the Civil Service Departments are full of outdated methods and of costly and, in many cases, unnecessary work and existing methods are not adequate to eradicate them.
Let me quote two examples, neither of them, I concede, on major matters. I quote them to illustrate what I mean. The volume of correspondence received by the Foreign Office has multiplied by three or four times in the last 30 years. It now approaches 750,000 items a year. Lord Plowden's Report on the Diplomatic Service noted this and urged restraint and recommended an annual review of work and staffing of overseas posts. But this simply does not begin to get to the roots of the problem. Indeed, the first and most vital question is simply not asked at all: how much of this work is necessary? I was interested in what the right hon. Member for Edinburgh, East (Mr. Willis) had to say, because he put his finger squarely on the point. How much of this information is necessary? How much of it is absorbed in the Foreign Office? How many reports simply duplicate what can be read in the newspapers? How much information is no longer relevant to British policy making? If there were a

systematic study on these lines, there is little doubt that perhaps hundreds of officials in the Foreign Office and overseas could be saved.
Private industry has shown the way; it can be done. In the current issue of "Export" which arrived in the post of most hon. Members this morning, this is stated:
In 1960, before Shell had the management consultants in, two tons of paper arrived daily at their head office. By 1966, with the aid of McKinsey, this had been cut to approximately one ton.
If the same could happen in the public service, what an immense saving there would be.
Let us take the local government subservience to Whitehall. Does a local authority really have to have the Ministry's consent before it can publish a scale of library fines? A more fantastic example emerged from yesterday's Sunday Express. Councillor Chaplin, chairman of the public baths committee of the London Borough of Haringey—(to which I pay my own excessive rates)—lost his glasses while attending a conference at Blackpool. The question arose as to whether the council should reimburse him for the loss of his glasses. Hon Members may think this a rather silly story, but the sting is in the tail. A council spokesman said:
In the case of council members it had to go before the council and the Minister of Housing and Local Government before payment can be made from council funds.
I find it fascinating to think of a little man tucked away in a small room at the top of the Ministry solemnly looking up the precedents to see whether he can advise the Minister to approve the payment of £5 to Councillor Chaplin. No wonder we have half a million civil servants.
This illustrates another need, and that is that every public official should be encouraged to question the value of his own job, and must be rewarded if he proves that it is unnecessary. I entirely agree with the hon. Member for Cornwall, North (Mr. Pardoe) that the transferability of pensions is absolutely vital.
Many speakers have questioned Whitehall's detailed scrutiny of control of local authorities. There has been a very rapid increase in the number of forms, and one


rural district in Suffolk estimated that it needed 552 man hours of staff on senior salary rates to complete those forms. Eventually the worm turns, and I am happy to say this one turned, and I have a letter which says
It would appear that your Minister has not invoked any statutory power to require local authorities to render the returns you ask for, and for the reasons stated I must regretfully decline to complete them unless payment is made for the work involved.
There is a serious point in this. Many local civil servants are only too anxious to see this bureaucratic nonsense in Whitehall curbed.
America is way ahead of us in this field. There is no reason why we should lag so far behind. What we need is the will to make an effort, and a much greater sense of urgency, and I doubt whether we shall find either on the Treasury Bench at present.
Then I come to the second head, that of measures, and the policies which determine the shape and size of the machinery CO carry them out. I agree with what the right hon. Gentleman said in the debate on 9th June, that, of course, it is by changes in policies we shall reduce bureaucracy; that is what the country needs.
Many of my hon. Friends have given their own examples of what can be done. Of course, it is the Government's new taxes which bear the palm. Corporation Tax, Capital Gains Tax, Selective Employment Tax. Including the staff necessary for S.E.T. probably one in seven or eight of the extra civil servants since 1960 are needed to raise the revenue. It has been calculated that the extra staff engaged and the extra man hours worked as a result of the Government's tax reforms would have needed 40,000 secretaries backing Britain by working half an hour extra a day.
The taxes themselves may be harmful, but that is not the issue in this debate. What is absolutely certain is that the work they have generated both inside and outside the Government machine represents a colossal diversion of effort away from the process of wealth creation into the wholly unproductive processes of tax administration. Complexity itself is at fault. In many ways the conflicting demands of equity and of simplicity simply cannot be met. Of course, if the tax

rates were lower then the need for this great complexity would itself be less as there would be less incentive to engage in elaborate avoidance devices. As it is, a great amount of time and effort are wasted.
Selective Employment Tax provides for an appeal to the Industrial Tribunal, and I must say that a study of the appeals which have gone up there in recent months is a very dispiriting exercise. A firm which manufactures and installs fittings for houses does not qualify for repayment, but if it does so for shops then it does qualify. If one is a consultant metallurgist engaged in testing metals for the trade one does not qualify for repayment because one is a scientific service, but if one's work is substantially for one firm one is part of his manufacturing operation. If one carries ready mixed cement to a building site one is in a transport service and does not qualify for premium, but if the wetting process is carried out during transit one does qualify. If one renovates, erects and decorates signs in situ that is building and does not qualify for premium, but if one does the renovation in a workshop and then takes the sign out and puts it up, that is manufacturing.
I have a number of other cases but will not weary the House with them, but this is the sort of unproductive work which generates frustration and disillusion. These distinctions are utterly without reason. They make no economic sense let alone complying with any discernible principle. It is bureaucracy gone mad.
Because the Selective Employment Tax requires payment and repayment, any delay in granting repayment, especially with a 10 per cent. Bank Rate, causes great hardship. [HON. MEMBERS: "8 per cent?"] I should have said with a 10 per cent, interest rate. Bank Rate is 8 per cent. I have a letter from a firm complaining of exactly that. It concludes:
This seems to be yet another example of the Government's ineptitude and a more serious example of the frustration which businessmen must contend with".
Another sphere in which a foolish policy has been laid down and which is swelling bureaucracy is that of investment grants. This contains exactly the same element of discrimination. There is no


appeal procedure and the matter is entirely within administrative discretion. It means moreover that the follies of it do not even see the light of day.
In it one can find the same irrational state of affairs; printing machinery qualifies, while photographic and enlarging equipment, which is essential in the production of newspapers, does not qualify for grant. Grants are available for mobile cranes but not for the lines on which they run. One can obtain a grant for a computer and peripheral equipment, but if one buys the peripheral equipment and plugs it into a computer bureau, there is no grant. If one ask for a grant for a spectrophotometer for use in an engineering research laboratory, one receives a grant, but if the equipment is to be used by a consultant metallurgist no grant is available. One is given a grant for a dump skip if it is used with a tractor, but one does not get a grant if one buys the tractor and a dump skip together. I could give many other examples, but I must press on.
There is, then, the problem of the immense complexity of the forms which are used in all this business and appalling detail that must be followed when the Board of Trade requires one to see if one can qualify. In fact, this procedure can defeat the whole purpose. This attention to finicky detail can obscure huge loopholes. The Board of Trade solemnly refused a grant for a United Kingdom-owned tug, bought by a United Kingdom company from a United Kingdom shipyard for use in a foreign port—simply because the tug was registered there. However, until the Board of Trade announced its new policy on 8th January, it cheerfully gave grants for ships built in foreign shipyards by foreign-owned companies amounting to £35 million.
The moral of all this is that much greater attention must be paid to the manpower implications of new policies. It means that if a policy is only tolerable, if it is accompanied by elaborate reliefs, exclusion and exceptions, with complicated appeals procedures and so on, then that is a powerful reason for not accepting the policy at all.
However effective the methods may be and however wise the measures, in the end they are of little avail if the men in power do not recognise the need for reducing

bureaucracy. The men in power—[HON. MEMBERS: "Where are they?"]—where are they indeed—must recognise this need.
We all have our favourite quotations. Mine comes from a debate which was held in the watches of the night earlier last year on the Finance Bill. A Tory Amendment to cut taxation was under discussion and the Chief Secretary argued that the rate of taxation was, in fact, the level of intervention. He said that a certain level of intervention was needed to provide community services. He added:
We believe that most of the things which the individual wants are best and most economically satisfied by the community …"—[OFFICIAL REPORT, 6th June, 1967; Vol. 747, c. 959.]
How can we expect any reduction in the Civil Service if the Government expect most of the gross national product to be found in the public services? On the contrary, it is a warning that we are to expect an increase—a steady, inexorable increase—in bureaucracy under the present Administration.
The Government have tried to take some credit for their holding operation—to keep the level unchanged. But it is really a short, temporary brief pause in the process which they anticipate, which they confidently expect and which they positively want to continue while they are in office. I do not believe, whatever else the electorate voted for in 1964 and 1966, that this country wants a massive, continuous increase in the number of civil servants. We on this side utterly reject the Government's whole philosophy as propounded by the Chief Secretary in the passage I have quoted.
There should be no doubt whatever of what our aim will be when we return to office. By the use of better methods, and by the use of wiser measures, we aim steadily to reduce the size of the Civil Service and the amount of bureaucracy that the country needs to endure. It is because the Government hold out no hope of achieving that aim—indeed, because they do not even seem to want to achieve it—that we condemn them tonight.

9.30 p.m.

The Minister of State, Ministry of Housing and Local Government (Mr. Niall MacDennot): When I read the


terms of the Motion, I did not expect that I would have to reply to a very seriously argued and high level debate. In listening to the debate, I was not disappointed in my expectation. Indeed, as I sat here, as I have done through almost the whole of the debate, I was reminded of one of Low's pre-war cartoons in the Evening Standard entitled "Future Conservative Prime Ministers." He depicted a series of the then Tory back benchers, with their policies, and the policy he attributed to the Duchess of Atholl was putting a stop to the Post Office, the drainage system and all other vestiges of Socialism. I feel that that has been about the level of most of this debate, though there were a few notable exceptions, with which I shall deal.
To some extent, the Opposition have had one hand tied behind their back in arguing this debate. They have been going out of their way to protest that they are not in any way attacking the Civil Service, but we know the kind of speeches they make outside compared with the kind they make inside this House; and how they try to provoke and cash in upon the prejudice that some people have against civil servants.
Another reason for my not expecting a high level of debate is that when we come to the subject of the growth of a bureaucracy we are entering one of the traditional fields of Tory mythology. We remember that at the time of the first Labour Government the mythology was about snoopers, with constant criticisms and complaints about people who had power to enter premises. We were told how all that would be swept away by the Tories. Of course, once they got into power we heard no more about it, and they proceeded to pass a succession of Measures all giving fresh powers of entry to various inspectors and investigators. There was the same kind of campaign against powers of compulsory purchase.
Why do I say that in relation to the growth of bureaucracy this is mythology? The Opposition have even convinced themselves that they somehow have the secret of reducing the numbers in the Civil Service. We have them boasting; it has been done today by both the right hon. and learned Member for Hexham (Mr. Rippon) and the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin). They boasted, "Why, during

the 13 years when we were in power we actually reduced the Civil Service by 11,000." So they did. But if these are to be the tests, the palm must be given to the post-war Labour Government, because they reduced the Civil Service by 70,000—[Interruption.]—the reduction was from 496,000 to 426,000.
But, of course, it is a false point—[Interruption.]—and so is the argument that has been advanced this evening, as I shall show. It is a false point because, during that period, what was happening was that the system of wartime controls was being dismantled, and the civil servants who had been required to carry out those controls were being released—[HON. MEMBERS: "The Land Commission."] I shall come to the Land Commission—do not worry. We have heard plenty from the Opposition about the Land Commission and taxation.
The whole of the reduction in the Civil Service for which hon. Members opposite claim credit resulted merely from a continuation of that process, which went on for six of their first seven years: not in their first year of power when, in fact, it went up by 10,000, because of the Korean war. Then, for six years, it declined. It declined by 46,000 compared with the decline of 70,000 under the Labour Government.
Let us rub all that out and ignore it and start at the time when one should start, when the Civil Service began to climb. That was from about 1959. In the last five years, from October 1959 to October 1964, when hon. Members opposite were in power, there was a very different picture indeed. The Civil Service grew steadily by 36,000, and it grew at an increasing rate. Half of that increase was in the last two years before hon. Members opposite fell from power.
What is interesting when one analyses the figures to see how they came about is that relatively little of those increases was due to the introduction of new policies. The great majority of them were what I could call natural growth, the natural growth of the Civil Service which results from an increase in the work load in order to implement existing policies. [An HON. MEMBER: "Parkinson's Law."] As one hon. Member—I do not know who—said, "Parkinson's Law". With all their skill in management techniques—how to ensure greater


efficiency, to keep the numbers down and use all the modern methods, to bring in businessmen and all the rest of the nostrums which hon. Members opposite have been advocating—the Civil Service grew by 36,000 in those five years.
Let us look at some of the Departments where the main increases were. The members in the Home Office and the Scottish Office went up by 3,100 and 1,600, respectively. These were mainly due to increases in prison staffs and other staffs resulting from the increase in crime. These were the sort of increases hon. Members opposite found it necessary to make. We have heard a great deal about how they would simplify taxation and reduce staffs by simplifying the tax system. In those five years the Inland Revenue required another 1,700 staff and Customs and Excise another 600—over 2,000 additional staff, not to implement new taxes but in order to cope with increases in the work load. The expansion of legal aid required an additional 1,500 civil servants.

Mr. Patrick Jenkin: The hon. and learned Gentleman has referred to the Inland Revenue. This is most astonishing, because the Government's own statistics show that from 1963 to 1965—in each case 1st April—the Inland Revenue staff declined. It was 59,700 in 1963, 58,000 in 1964 and 57,600 in 1965. How does the hon. and learned Gentleman find an increase there?

Mr. MacDermot: I assure the hon. Member that the figures I have given were received from the Inland Revenue for the five-year period from 1959. If his figures are right, the number must have increased very much before.
Then there is the Land Registry. We all know of the need to increase the amount of conveyances recorded on the Land Registry to reduce the load on solictors' conveyancing practice. That accounted for an increase of 1,100 civil servants in those five years. There were substantial increases in the Ministry of Defence in those five years. This is one of the examples of what the hon. Member has been speaking about; the fact that mergers in the first stage produce increases in staff in the Ministry of Defence. Some of these increases were due to new policies. Improved National

Assistance allowances required another 3,000 staff in the Ministry of Pensions and National Insurance. The graduated pension scheme—I will not call it improvement, but "scheme"—required administering and required another 3,500 civil servants.

The Minister of Public Building and Works (Mr. Robert Mellish): Under the Tories.

Mr. MacDermot: Yes, under the Tories, during their last five years. We are not complaining about this. We did not complain about it at the time. We realised that in order to improve the service that they were giving to the public and to implement policies they would require these additional staffs. We did not try to make political capital out of it, as the Tories do now. We accepted it as necessary, as hon. Members opposite do whenever we discuss any measures which they support. They do not complain then about the increase in the number of civil servants. Were these extra 36,000 civil servants bureaucratic dropsy on the part of the Tories? Was this proof that bureaucracy is inseparable from Socialism?
One can understand why the right hon. and learned Member for Hexham was selected to open this debate. He is something of an authority on the growth of bureaucracy. To do him justice, as my right hon. Member the Member for Leeds, West (Mr. C. Pannell) said, the right hon. and learned Gentleman was the biggest empire builder the Conservatives ever had. In 1951 the Ministry of Works, as it then was, had 16,000 civil servants. With the running down of controls, that number was reduced, by the time that the right hon. and learned Gentleman took over the Ministry, to 10,006, to be precise. Just over two years later, In October 1964, the number had risen to 20,727.

Mr. Rippon: Does not the Minister of State realise that there is a great difference between taking away civil servants from other Departments and using them more efficiently and allowing a total increase in the Civil Service? Why does the hon. and learned Gentleman persist in comparing the increase in five years of Conservative government with the increase in three years of Socialist government?


Does he not recognise that, even on his argument, the rate of increase under the Labour Government has been twice as fast?

Mr. MacDermot: The right hon. and learned Gentleman has already made one long speech. He should not try to make another. Nor should he be so modest. He used not to be. When he was at the Ministry of Public Building and Works, he produced a little pamphlet on his Ministry in which he set out, with a nice photograph of himself, and with a foreword by the Minister, an account which was prepared and distributed to all his staff—all 20,000 of them—describing what the work of his Ministry was. He was very successful. Yet one can well imagine what the reaction would be if his successor at the Ministry were to produce such a pamphlet. The right hon. and learned Gentleman, in justification, says, "With these additional staffs, I was doing things which were not being done in the Ministry before". He says that he took over functions from other Departments; he took over responsibilities; he was doing work which the Department had not done before; this was the reason for the increase in the number of civil servants.
We are doing the work which was not being done before. This is something which hon. Members opposite either cannot get into their heads or about which they do not want to know. Let us look at the Departments where there have been the main increases about which hon. Members opposite complain. The Ministry of Social Security has had the biggest increase—8,600. The principal reasons for this increase has been the increase in administration due to the earnings related benefit and the new supplementary benefits schemes.
My right hon. Friend the Member for Lanarkshire, North (Miss Herbison) asked the hon. Member for Bromsgrove (Mr. Dance) whether he wanted to reduce the staffs who were administering the supplementary benefit scheme. "Oh, no", he said, "I will come to that later and say where I am going to reduce them". When he came to it later, his only constructive proposal was that the Prime Minister should call his Departmental Ministers and tell each one of them that they had got to reduce their staffs by "X" per

cent, across the board. The right hon. and learned Member for St. Marylebone (Mr. Hogg) did not do it in his Department when his party were in government. Is this one of the Departments in which he wants to see an X per cent, reduction, and, if so, what services does he want reduced?
In the Ministry of Labour we had the earnings-related benefit scheme and the redundancy payments scheme, the expansion of the Government training programme which we are constantly urged to increase, and the increase in the work load on other benefits.
Next the Home Office. There is an increase in the prison service. We remember the screams there were on the benches opposite and their motion of censure when a few prisoners escaped from prison, and the demand for an increase in prison staffs.
In the Minstry of Transport there is an increase of 3,100, 1,000 on measures concerned with road safety, 1,800 on the reorganisation of work in connection with the road programme, including a transfer of about 1,192 staff from local authorities.
In Customs and Excise there has been an increase in the work load in connection with the Betting and Gaming Act. Do hon. Members want that removed? The right hon. Member for Enfield, West (Mr. Iain Macleod) said it would not work. Well, it is working. It is working very well and it requires staff.
In the Land Commission, to which I will come if hon. Members opposite give me permission, there is an increase of 1,400.
Agriculture and Fisheries, an increase of 1,100. We do not hear any demand from the National Farmers' Union for a reduction in the Ministry's advisory services or in the number of officials responsible for making the many grants to agriculture.
In the Land Registry, continuing the policy of the previous Government, we are increasing the staff by 1,100. And so on.
Hon. Members want me to deal with the Land Commission and taxation, and I shall be delighted to do so because these are among the few proposals that they have made for any reduction.


Starting with the Land Commission, let us remember why it was set up. It was set up because the public in this country had become quite scandalised by the amount of profits made in land speculation which were escaping tax, and they would not stand for it any longer. The Land Commission was set up, first to recover for the community an appropriate share of the increase in betterment, through the betterment levy; and secondly, as an organisation able to acquire and deal in land in order to make the levy effective and bring land forward for development.
The other day the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) said—and the figure has been repeated today—that there could be a saving here of 2,000 staff and £7 million a year. The figures are not right. It would save 1,460 staff and £3 million a year. He also claimed that it would save up to £75 million in capital expenditure. As a former Chief Secretary he ought to know better than that, and I think he does. It is a phoney figure. As he knows, the limit at the moment on Consolidated Fund Advancement is £45 million without coming back to Parliament, and it is not implicit that anything of that order will be required for a considerable time for the pump-priming operation.
Let us consider the staff; 912 are engaged in levy collection and about 550 on the land side. What do the Opposition propose to do? I had understood that they accepted the principle of the levy, that they accepted that the public were not going to stand any longer for there being no contribution from betterment returning to the community. What is intriguing, and somewhat sinister, is to find in a Tory pamphlet called "Three-way Contact Programme"—whatever that means—"Master-brief 11—Building a Better Britain", that it is said at the end:
The Conservative Party believes that … any increase in land values should be taxed in the same way as other capital gains.
If that is what the Tory Party believes, we ought to be told. There are fundamental distinctions between betterment and capital gains, as hon. Members know. I remember well from the long hours on the Finance Bill how hon. Members

opposite used to impress upon us that capital gains—in many cases this is true—are the fruit of the labour of the people who earned the asset or—they did not always say this—of their employees. Betterment, on the other hand, no one can describe, by any stretch of the imagination, as the fruit of a man's labour. It is the benefit which the landowner gets because of the increase in the value of his land as a result of development by the community, usually expressed by a grant of planning permission.
Because of this fundamental difference, they are treated quite differently. The first and major difference is in the rate. The rate for betterment levy is 40 per cent., and we have made clear that it is our intention to increase that in stages. For Capital Gains Tax, the top rate, the flat rate, is 30 per cent., but this, basically, is paid only by Surtax payers. For the ordinary payer of Income Tax at the standard rate it is 20¼ per cent., and for people paying at less than the standard rate as their marginal rate it is lower than that. Do the Tories mean that they will replace the 40 per cent, betterment levy by those rates of Capital Gains Tax?
That is not all the difference. Because of the difference in nature between betterment levy and Capital Gains Tax, there are differences in the occasion of charge. The most important difference is that betterment levy is levied at the time when the land is being developed, which is not the occasion for charge to Capital Gains Tax. And the date which one takes for the base value for the purpose of assessment of the gain is quite different for betterment levy as opposed to Capital Gains Tax.
If right hon. and hon. Members opposite mean to replace the betterment levy by Capital Gains Tax, what they mean is that they propose to reduce the incidence of the levy to a contemptibly small level in very many cases and produce another bonanza for the speculator.

Mr. Reginald Eyre: The hon. and learned Gentleman is giving a wonderful example of bureaucratic thinking because to resolve in a practical way the theoretical differences he has just discussed involves thousands of extra staff in the Land Commission and the Inland Revenue discussing the difference between the levy, Capital Gains


Tax and Corporation Tax. It is a wonderful example of swollen staffs.

Mr. MacDermot: It does not require thousands. It requires 912 at the moment, and I predict that we shall see that figure reduced during the coming year.
In addition to making the level of the levy contemptibly small, do the Opposition intend to abolish all the powers of land acquisition which can make it effective? We all know that one of the reasons for the failure of the old development charge system was that the land acquisition powers of the Central Land Board were wholly inadequate, a deficiency which we have now rectified through the Land Commission. [HON. MEMBERS: "What about the S.E.T.?"] I thought that hon. Members opposite would want to get off this subject. I have five minutes left. If they want me to talk about the S.E.T., very well. Let us switch to taxes. [An HON. MEMBER: "What about the machinery of Government?"] I hear that one hon. Gentleman wants me to talk about the machinery of Government, but I shall deal next with taxation, as I am asked to do.
We are told to simplify the tax system, which, of course, the Tories failed to do. What makes tax systems complicated and what requires a lot of staff is the sophisticated tax like Income Tax, the Capital Gains Tax or the Corporation Tax. When there is a simple tax which is crude in structure very small staffs are employed. The classic example is the one which hon. Members opposite say they will abolish—S.E.T.—the cheapest tax to collect which we have ever had. Hon. Members opposite do not want to know the figure. The cost of collecting S.E.T. is 2½d. in the pound, including the cost of paying the refunds and the premiums to industry.
Perhaps hon. Members opposite could make clear what streamlining in the tax system they will make with great savings in staff. I assume that they will not get rid of the betting and gaming tax. We have understood that they will not get rid of the Corporation Tax system, although they will no doubt make changes in it which will make it more complicated. They will not get rid of the Capital Gains Tax, although they will no doubt make amendments which will

make it more complicated. As far as I know, they will not get rid of Estate Duty, although they perhaps will amend that as well and make it more complicated.
The only tax they will abolish is S.E.T., and then what is the nostrum? We heard it in the illuminating speech of the hon. Member for Bromsgrove. The solution is to replace S.E.T. by the value-added tax system. If that will do one thing, it certainly will not save staff. The collection of taxes at present by Purchase Tax is very simple and relatively cheap. There is one point of collection, at the wholesaler. If we collected the same money by the value-added tax system, the cost of collection would be four to five times as great, and four to five times the number of staff would be required. The nostrum hon. Members opposite produce on tax simplification is another vague generality. There are no constructive proposals to achieve it.
Then they say that we should use modern management techniques.

Mr. Rippon: Investment grants.

Mr. MacDermot: The right hon. and learned Gentleman now wants me to switch to investment grants. I have been asked to reply to a number of questions, one of which was about modern management techniques. The right hon. and learned Gentleman perhaps does not realise the extent to which we have made increasing use of them. There are a number of experts on both sides of the House, and they know that the O. and M. staffs in the Treasury are among the first to have employed O. and M. techniques in this country, and they do so with great skill. They have been increased under the present Government from about 400 to about 700 personnel, an increase which the right hon. Member for Enfield, West (Mr. Iain Macleod) asked us to make.
We were asked to bring in outside management consultants. If hon. Members opposite have read their HANSARD, they would have seen a list published last November of over 60 assignments where outside management consultants were brought in to operate in the Civil Service. In addition, we are having joint management consultations between the O. and M. staffs and the outside staff brought in.
The one serious proposal by the right hon. and learned Gentleman was that we should consider how to avoid the duplication between local government and central Government. If we had time and wanted to debate the matter seriously, which it is clear hon. Members opposite do not, this is where we could look for real reductions, but I do not believe that

this will be possible until we get the Report of the Maud Committee—

Mr. William Whitelaw: Mr. William Whitelaw (Penrith and the Border) rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly:—

The House divided: Ayes 224, Noes 304.

Division No. 35.]
AYES
[10.0 p.m.


Alison, Michael (Barkston Ash)
Fraser, Rt. Hn. Hugh(St'fford &amp; Stone)
McAdden, Sir Stephen


Allason, James (Hemel Hempstead)
Gibson-Watt, David
MacArthur, Ian


Astor, John
Giles, Rear-Adm. Morgan
Maclean, Sir Fitzroy


Atkins, Humphrey (M't'n &amp; M'd'n)
Gilmour, Ian (Norfolk, C.)
Macleod, Rt. Hn. lain


Awdry, Daniel
Gilmour, Sir John (Fife, E.)
McMaster, Stanley


Baker, W. H. K.
Glover, Sir Douglas
Macmillan, Maurice (Farnham)


Balniel, Lord
Glyn, Sir Richard
Maddan, Martin


Batsford, Brian
Godber, Rt. Hn. J. B.
Maginnis, John E.


Bell, Ronald
Goodhart, Philip
Marples, Rt. Hn. Ernest


Bennett, Sir Frederic (Torquay)
Goodhew, Victor
Marten, Neil


Bennett, Dr. Reginald (Cos. &amp; Fhm)
Gower, Raymond
Maude, Angus


Berry, Hn. Anthony
Grant, Anthony
Maudling, Rt. Hn. Reginald


Bitten, John
Grant-Ferris, R.
Mawby, Ray


Biggs-Davison, John
Gresham Cooke, R.
Maxwell-Hyslop, R. J.


Birch, Rt. Hn. Nigel
Grieve, Percy
Maydon, Lt.-Cmdr. S. L. C.


Black, Sir Cyril
Grimond, Rt. Hn. J.
Mills, Peter (Torrington)


Blaker, Peter
Hall, John (Wycombe)
Mills, Stratton (Belfast, N)


Boardman, Tom
Hamilton, Marquess of (Fermanagh)
Miscampbell, Norman


Body, Richard
Hamilton, Michael (Salisbury)
Mitchell, David (Basingstoke)


Bossom, Sir Clive
Harris, Frederic (Croydon, N.W.)
Monro, Hector


Boyd-Carpenter, Rt. Hn. John
Harris, Reader (Heston)
Morgan, Geraint (Denbigh)


Boyle, Rt. Hn. Sir Edward
Harvey, Sir Arthur Vere
Morrison, Charles (Devizes)


Brinton, Sir Tatton
Hastings, Stephen
Mott-Radclyffe, Sir Charles


Bromley-Davenport, Lt-Col. Sir Walter
Hawkins, Paul
Munro-Lucas-Tooth, Sir Hugh


Brown, Sir Edward (Bath)
Hay, John
Murton, Oscar


Bruce-Gardyne, J.
Heald, Rt. Hn. Sir Lionel
Nabarro, Sir Gerald


Bryan, Paul
Heath, Rt. Hn. Edward
Neave, Airey


Buchanan-Smith, A1ick(Angus, N&amp;M)
Heseltine, Michael
Nicholls, Sir Harmar


Buck, Antony (Colchester)
Higgine, Terence L.
Noble, Rt. Hn. Michael


Bullus, Sir Eric
Hiley, Joseph
Nott, John


Campbell. Gordon
Hill, J. E. B.
Onslow, Cranley


Carlisle, Mark
Hogg, Rt. Hn. Quintin
Orr, Capt. L. P. S.


Carr, Rt. Hn. Robert
Holland, Philip
Orr-Ewing, Sir Ian


Cary, Sir Robert
Hooson, Emlyn
Osborn, John (Hallam)


Channon, H. P. G.
Hordern, Peter
page, Graham (Crosby)


Chichester-Clark, R.
Hornby, Richard
Page, John (Harrow, W.)


Clark, Henry
Howell, David (Guildford)
Pardoe, John


Clegg, Walter
Hunt, John
Percival, Ian


Cooke, Robert
Hutchison, Michael Clark
Peyton, John


Cooper-Key, Sir Neill
Iremonger, T. L.
Pike, Miss Mervyn


Cordle, John
Irvine, Bryant Godman (Rye)
Pink, R. Bonner


Corfield, F. V.
Jenkin, Patrick (Woodford)
Powell, Rt. Hn. J. Enoch


Costain, A. P,
Jennings, J. C. (Burton)
Price, David (Eastleigh)


Craddock, Sir Beresford (Spelthorne)
Johnson Smith, G. (E. Grinstead)
Prior, J. M. L.


Crowder, F. P.
Johnston, Russell (Inverness)
Quennell, Miss J. M.


Cunningham Sir Knox
Jones, Arthur (Northants, S.)
Rawlison, Rt. Hn. Sir David


Currie, G. B. H.
Jopling, Michael
Roes-Davies, W. R.


Dalkeith, Earl of
Joseph, Rt. Hn. Sir Keith
Renton, Rt. Hn. Sir David


Dance, James
Kaberry, Sir Donald
Ridley, Hn. Nicholas


d'Avigdor-Coldsmid, Sir Henry
Kerby, Capt. Henry
Ridsdale, Julian


Dean, Paul (Somerset, N.)
Kimball, Marcus
Rodgers, Sir John (Sevenoaks)


Doughty, Charles
King, Evelyn (Donald, S.)
Rossi, Hugh (Hornsey)


Drayton, G. B.
Kitson, Timothy
Royle, Anthony


du Cann, Rt. Hn. Edward
Lancaster, Col. C. G.
Russell, Sir Ronald


Eden, Sir John
Lane, David
Scott, Nicholas


Elliot, Capt. Walter (Carshalton)
Langford-Holt, Sir John
Scott-Hopkins, James


Elliott,R.W.(N'c'tle-upon-Tyne,N.)
Legge-Bourke, Sir Harry
Sharpies, Richard


Emery, Peter
Lewis, Kenneth (Rutland)
Shaw, Michael (Sc'b'gh &amp; Whitby)


Errington, Sir Eric
Lloyd,Rt.Hn.Geoffrey(Sut'n C'dfield)
Silvester, Frederick


Farr, John
Lloyd, Ian (P'tsm'th, Langstone)
Sinclair, Sir George


Fisher, Nigel
Lloyd, Rt. Hn. Selwyn (Wirral)
Smith, John


Fletcher-Cooke, Charles
Longden, Gilbert
Stainton, Keith


Fortescue, Tim
Loveys, W. H.
Stodart, Anthony


Foster, Sir John
Lubbock, Eric
Stoddart-Scott, Col. Sir M. (Ripon)




Summers, Sir Spencer
Vaughan-Morgan, Rt. Hn. Sir John
Wills, Sir Gerald (Bridgwater)


Tapsell, Peter
Wainwright, Richard (Colne Valley)
Wilson, Geoffrey (Truro)


Taylor, Sir Charles (Eastbourne)
Walker, Peter (Worcester)
Wolrige-Gordon, Patrick


Taylor, Edward M.(G'gow, Cathcart)
Walker-Smith, Rt. Hn. Sir Derek
Wood, Rt. Hn. Richard


Taylor, Frank (Moss Side)
Wall, Patrick
Woodnutt, Mark


Teeling, Sir William
Walters, Dennis
Wright, Esmond


Temple, John M.
Ward, Dame Irene
Wylie, N. R.


Thorpe, Rt. Hn. Jeremy
Weatherill, Bernard
Younger, Hn. George


Tilney, John
Webster, David



Turton, Rt. Hn. R. N.
Wells, John (Maidstone)
TELLERS FOR THE AYES:


van Straubenzee, W. R.
Whitelaw, Rt. Hn. William
Mr. Jasper More and




Mr. Reginald Eyre.




NOES


Alhu, Austen
Dunwoody, Dr. John (F'th &amp; C'b'e)
Jay, Rt. Hn. Douglas


Allaun, Frank (Salford, E.)
Eadie, Alex
Jeger, George (Goole)


Alldritt, Walter
Edwards, Rt. Hn. Ness (Caerphilly)
Jeger, Mrs. Lena (H'b'n&amp;St.P'cras,S.)


Allen, Scholefield
Edwards, William (Merioneth)
Jenkins, Hugh (Putney)


Anderson, Donald
Ellis, John
Jenkins, Rt. Hn. Roy (Stechford)


Archer, Peter
English, Michael
Johnson, Carol (Lewisham, S.)


Armstrong Ernest
Ennals, David
Jones, Dan (Burnley)


Atkins, Ronald (Preston, N.)
Evans, Albert (Islington, S.W.)
Jones, J. Idwal (Wrexham)


Atkinson, Norman (Tottenham)
Fernyhough, E.
Jones, T. Alec (Rhondda, West)


Bacon, Rt. Hn. Alice
Finch, Harold
Judd, Frank


Bagier, Gordon A. T.
Fitt, Gerard (Belfast, W.)
Kelley, Richard


Barnes, Michael
Fletcher, Raymond (likeston)
Kenyon, Clifford


Barnett, Joel
Fletcher, Ted (Darlington)
Kerr, Mrs. Anne (R'ter &amp; Chatham)


Beaney, Alan
Foley, Maurice
Kerr, Dr. David (W'worth, Central)


Bellenger, Rt. Hn. F. J.
Foot, Sir Dingle (Ipswich)
Kerr, Russell (Feltham)


Bence, Cyril
Foot, Michael (Ebbw Vale)
Lawson, George


Benn, Rt. Hn. Anthony Wedgwood
Ford, Ben
Ledger, Ron


Bennett, James (G'gow, Bridgeton)
Forrester, John
Lee, Rt. Hn. Frederick (Newton)


Bidwell, Sydney
Fowler, Gerry
Lee, Rt. Hn. Jennie (Cannock)


Binns, John
Fraser, John (Norwood)
Lee, John (Reading)


Bishop, E. S
Freeson, Reginald
Lestor, Miss Joan


Blackburn, F
Galpern, Sir Myer
Lever, Harold (Cheetham)


Boardman, H.
Gardner, Tony
Lever, L. M. (Ardwick)


Booth, Albert
Garrett, W. E.
Lewis, Arthur (W. Ham, N.)


Boston, Terence
Ginsburg, David
Lewis, Ron (Carlisle)


Boyden, James
Gordon Walker, Rt. Hn. P.C.
Lipton, Marcus


Braddock, Mrs. E. M.
Gourlay, Harry 
Lomas, Kenneth


Bradley, Tom
Gray, Dr. Hugh (Yarmouth)
Loughlin, Charles


Bray, Dr. Jeremy 
Greenwood, Rt. Hn. Anthony
Luard, Evan


Brooks, Edwin
Gregory, Arnold 
Lyon, Alexander W (York)


Broughton, Dr. A. D. D.
Grey, Charles (Durham)
Lyon, Edward (Bradford, E)


Brown, Hugh D. (G'gow, Provan)
Griffiths, David (Rother Valley)
Mabon, Dr. J. Dickson


Brown, Bob (N'c'tle-upon-Tyne, W.)
Griffiths, Rt. Hn. James (Llanelly)
McBride, Neil


Buchan, Norman
Griffiths, Will (Exchange)
McCann, John


Buchanan, Richard (G'gow, Sp'burn)
Gunter, Rt. Hn. R. J.
MacColl, James


Butler, Herbert (Hackney, C.)
Hamilton, William (Fife, W.)
MacDermot, Niall


Butler, Mrs. Joyce (Wood Green)
Hamling, William
Macdonald, A. H.


Callaghan, Rt. Hn. James
Hannan, William
McGuire, Michael


Carmichael, Neil
Harper, Joseph
McKay, Mrs. Margaret


Carter-Jones, Lewis
Harrison, Walter (Wakefield)
Mackie, John


Castle, Rt. Hn. Barbara
Hart, Rt. Hn. Judith
Maclennan, Robert


Coe, Denis
Haseldine, Norman
McMillan, Malcolm (Western Isles)


Concannon, J. D.
Hattersley, Roy
McMillan, Tom (Glasgow, C)


Conlan, Bernard
Hazell, Bert
McNamara, J. Kevin


Corbet, Mrs. Freda
Healey, Rt. Hn. Dene
Mahon, Simon (Bootle)


Craddock, George (Bradford, S.)
Heffer, Eric S.
Mallalieu, E. L. (Brigg)


Crawshaw, Richard
Henig, Stanley
Mallalieu,J.P.W.(Hudderefield,E.)


Cronin, John
Herbison, Rt. Hn. Margaret
Manuel, Archie


Crosland, Rt. Hn. Anthony
Hilton, W. S.
Mapp, Charles


Crossman, Rt. Hn. Richard
Hobden, Dennis (Brighton, K'town)
Marks, Kenneth


Cullen, Mrs. Alice
Hooley, Frank
Marquand, David


Darling, Rt. Hn. George
Horner, John
Marsh, Rt. Hn. Richard


Davidson, Arthur (Accrington)
Houghton, Rt. Hn. Douglas
Mason, Rt. Hn. Roy


Davies, Dr. Ernest (Stretford)
Howarth, Harry (Wellingborough)
Maxwell, Robert


Davies, G. Elfed (Rhondda, E.)
Howarth, Robert (Bolton, E.)
Mayhew, Christopher


Davies, Ednyfed Hudson (Conway)
Howell, Denis (Small Heath)
Mellish, Robert


Davies, Harold (Leek)
Hoy, James
Mendelson, J. J.


Delargy, Hugh
Huckfield, Leslie
Mikardo, Ian


Dell, Edmund
Hughes, Rt. Hn. Cledwyn (Anglesey)
Millan, Bruce


Dernpsey, James
Hughes, Emrys (Ayrshire, S.)
Miller, Dr. M. S.


Dewar, Donald
Hughes, Hector (Aberdeen, N.)
Milne, Edward (Blyth)


Diamond, Rt. Hn. John
Hughes, Roy (Newport)
Mitchell, R. C. (S'th'plon, Test)


Dickens, James
Hunter, Adam
Molloy, William


Dobson, Ray
Hynd, John
Moonman, Eric


Doig, Peter
Irvine, Sir Arthur
Morgan, Elystan (Cardiganshire)


Dunn, James A.
Jackson, Colin (B'h'se &amp; Spenb'gh)
Morris, Alfred (Wythenshawe)


Dunnett, Jack
Jackson, Peter M. (High Peak)
Morris, Charles R. (Openshaw)


Dunwoody, Mrs. Gwyneth (Exeter)
Janner, Sir Barnett
Morris, John (Aberavon)







Moyle, Roland
Rankin, John
Thomson, Rt. Hn. George


Mulley, Rt. Hn. Frederick
Rees, Merlyn
Thornton, Ernest


Murray, Albert
Reynolds, G. W.
Tinn, James


Neal, Harold
Richard, Ivor
Tomney, Frank


Newens, Stan
Roberts, Albert (Normanton)
Tuck, Raphael


Norwood) Christopher
Roberts, Goronwy (Caernarvon)
Urwin, T. W.


Oakes, Gordon
Roberts, Gwilym (Bedfordshire, S.)
Varley, Eric G.


Ogden, Eric
Robinson, Rt.Hn. Kenneth (St.P'c'as)
Wainwright, Edwin (Dearne Valley)


O'Malley, Brian
Robinson, W. O. J. (Walth' stow, E.)
Walden, Brim (All Saints)


Oram, Albert E.
Roebuck, Roy
Walker, Harold (Doncaster)


Orbach, Maurice
Rogers, George (Kensington, N.)
Wallace, George


Orme, Stanley
Rose, Paul
Watkins, David (Consett)


Oswald, Thomas
Rose, Rt. Hn. William
Watkins, Tudor (Brecon &amp; Radnor)


Owen, Dr. David (Plymouth, S'tn)
Rowlands, E. (Cardiff) N.)
Weitzman, David


Owen, Will (Morpeth)
Ryan, John
Wellbeloved, James


Padley, Walter
Shaw, Arnold (Ilford, S.)
Wells, William (Walsall, N.)


Paget, R. T.
Sheldon, Robert
White, Mrs. Eirene


Palmer, Arthur
Shinwell, Rt. Hn. E.
Whitlock, William


Panned, Rt. Hn. Charles
Shore, Peter (Stepney)
Wilkins, W. A.


Park, Trevor
Short, Rt.Hn. Edward (N'c'tle-u-Tyne)
Willey, Rt. Hn. Frederick


Parker, John (Dagenham)
Short, Mrs. Ren&amp;ée(W'hampton,N.E.)
Williams, Alan (Swansea, W.)


Parkin, Ben (Paddington, N.)
Silkin, Rt. Hn. John (Deptford)
Williams, Alan Lee (Hornchurch)


Parkyn, Brian (Bedford)
Silverman, Julius (Aston)
Williams, Clifford (Abertillery)


Pavitt, Laurence
Skeffington, Arthur
Williams, W. T. (Warrington)


Pearson, Arthur (Pontypridd)
Slater, Joseph
Willis, George (Edinburgh, E.)


Pentland, Norman
Small, William
Wilson, Rt. Hn. Harold (Huyton)


Perry, Ernest G. (Battersea, S.)
Snow, Julian
Wilson, William (Coventry, S.)


Perry, George H. (Nottingham, S.)
Spriggs, Leslie
Winnick, David


Prentice, Rt. Hn. R. E.
StonehOuse, John
Woodburn, Rt. Hn. A.


Price, Christopher (Perry Barr)
Strauss, Rt. Hn. G. R.
Woof, Robert


Price, Thomas (WeSthoughton)
Swain, Thomas
Wyatt, Woodrow


Price, William (Rugby)
Swingler, Stephen



Probert, Arthur
Taverne, Dick
TELLERS FOR THE NOES:


Randall, Harry
Thomas, George (Cardiff, W.)
Mr. W. Howie and




Mr. Ioan L. Evans.

Orders of the Day — BUSINESS OF THE HOUSE

Ordered,
That the Proceedings on the Provisional Collection of Taxes Bill [Lords] and Capital Allowances Bill [Lords] may be entered upon and proceeded with at this day's Sitting at any hour, the ugh opposed.—[The Solicitor-General.

Orders of the Day — PROVISIONAL COLLECTION OF TAXES BILL [Lords]

Considered in Committee.

[Mr. SYDNEY IRVING in the Chair]

Clauses 1 to 6 ordered to stand part of the Bill.

Schedule.

(REPEALS.)

10.15 p.m.

Mr. Graham Page: I beg to move, in page 6, line 4, at end insert:
'except as stated in section 6(3) of this Act'.
I raised this subject on Second Reading and although it is a matter of drafting, the whole of Consolidation Bills is a matter of drafting and unless the drafting is right, the Bill is purposeless. I have to refer first to Clause 6(3) in order to explain the Amendment to the Schedule. That subsection says:
Nothing in this Act applies to, or affects the Provisional Collection of Taxes Act 1913 in its application to, the House of Commons of the Parliament of Northern Ireland".
In subsection (2) there is reference to the enactments repealed in the Schedule. The enactments specified in the Schedule are repealed to the extent mentioned in the third column of the Schedule. Against the Provisional Collection of Taxes Act, 1913, appear the words "the whole Act". That is not true. Having regard to the provisions of Clause 6(3), the whole Act is not repealed.
As the Bill is drafted, it is wholly misleading to say that the whole of the provisional collection of Taxes Act, 1913, is repealed. The practitioner studying a Consolidation Measure turns first to the Long Title to see generally what the Measure intends to do, and then in practice at once to the Repeals Schedule to see what of his old law is now embodied in the new Consolidation

Measure. If he does that in this case, he will find that the whole of that Act is said to have been repealed, whereas in fact it has not been wholly repealed but remains in operation so as to affect Northern Ireland.
I am aware that the Government of Northern Ireland's (Adaptation of Taxing Act) Order, 1922, interpreted this Act as having some reference to Northern Ireland, but it did not make a new Act applying to Northern Ireland and it seems quite untrue to say, as the Schedule does, that the whole of the Act is repealed.

The Solicitor-General (Sir Arthur Irvine): The hon. Member for Crosby (Mr. Graham Page) referred to this matter on Second Reading and I have given careful thought to his Amendment. Clause 6(3) provides that nothing in the Bill applies to the House of Commons of the Parliament of Northern Ireland or affects the 1913 Act in its application to that House. It is perfectly accurate to say, as the hon. Gentleman has said, that in the third column of the Schedule, on the extent of repeal, against the 1913 Act it is recorded that the whole Act is repealed. But, of course, the operation of the Schedule and of Clause 6(2) which introduces it is governed by the provision of Clause 6(3), that nothing in the Bill shall affect the 1913 Act in its application to the House of Commons of Northern Ireland.
The words there "nothing in this Act" comprehend Clause 6(2) and the Schedule. Therefore, on analysis, in my submission, there is no room for uncertainty as to the effect of the provision as it stands. I readily agree that the question remains whether this is a sensible way of giving effect to the law. As to that I have made careful inquiries. The position is that the general practice is to rely on the provision in an Act which defines its territorial extent, and not to repeat that provision in a repeal Schedule.
That rule has been followed in Finance Acts in relation to enactments passed before 1922, which apply, for example, both to death duties and Stamp Duties in force in Great Britain, and to those duties in force as transferred taxes in Northern Ireland. The last Section of a Finance


Act contains as a matter of common form a provision to the effect that:
Except as otherwise expressly provided, such of the provisions of this Act as relate to matters in respect of which the Parliament of Northern Ireland has power to make laws shall not extend to Northern Ireland.
A repeal Schedule relating to duties which, in Northern Ireland are transferred taxes, contains no express savings.
It is true that in the Finance Act, 1967, contrary to the general practice, there was express provision made saving the Northern Ireland exception. Having put the saving in terms, and spelled it out in the body of the Act, and not relying in this instance, in the 1967 Act, upon the overall saving for Northern Ireland in Section 45(7), it was thought right in that special instance alone to make provision in the Schedule to make it clear, as the hon. Gentleman desires to have it made clear in the present instance, that the saving had taken effect.
That course was followed in the special and peculiar circumstances of the Finance Act, 1967, and was done because it was represented to the draftsmen that that was a desirable way of dealing with the matter. What I have just said about the 1967 Act does not alter the weight of the point that I have earlier put forward, namely that the general practice is to make provision in the repeal Schedule for the repeal of the whole Act, and rely upon what is contained in the body of the Statute to show the territorial extent of the provisions. It is my recommendation to the Committee that it is desirable to adhere, so far as possible, to the general rule that the provision regarding the territorial extent of a Statute is included in the Statute once only. Departures from that practice can only tend to lead to confusion. So long as it is understood that the extent of a repeal Schedule cannot be determined without looking at the body of the Act, no danger arises. But if a practice grew up of sometimes repeating such provisions in repeal Schedules, people who did not find such a provision in a repeal Schedule and did not look at the body of the Act would be liable to be misled.
The reasons for the special entries in the Finance Act, 1967, were as I have put forward. They do not apply in this consolidation Bill where the danger of the exemption of Northern Ireland being overlooked is, in my view, not real. The Bill relates primarily to the Provisional Collection of Taxes Act, 1913, and there is no reason to depart from the general rule that provisions for territorial extent are not repeated in a repeal Schedule. There is some reason to think that if the departure from precedent were made which is incorporated in this Amendment, the overall result would be to add to rather than diminish the risk of misunderstanding and confusion. For that reason, I ask the Committee to reject the Amendment.

Mr. Graham Page: That was a most unsatisfactory answer. The Solicitor-General asked whether this was a sensible way to give effect to the law. Clause 6(3) says quite clearly that the Provisional Collection of Taxes Act, 1913, remains in force for Northern Ireland. The Schedule says that the whole Act is repealed. Is that a sensible way of enacting the law? If it is sensible to put it in the text that the Act remains in force for Northern Ireland, I am sure that it is sensible to repeat it in the Schedule.
If the precedents do not support us, it is about time that we changed them. They will not cause the confusion to which the Solicitor-General referred. The confusion will arise from following precedent and saying two contradictory things in the Bill.

Amendment negatived.

Schedule agreed to.

Bill reported, without Amendment.

Motion made, and Question, That the Bill be now read the Third time, put forthwith, pursuant to Standing Order No. 55 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, without Amendment.

CAPITAL ALLOWANCES BILL [Lords]

Considered in Committee.

[Mr. SYDNEY IRVING in the Chair]

Clauses 1 to 95 ordered to stand part of the Bill.

Clause 96.

(COMMENCEMENT AND REPEALS.)

10.30 p.m.

Mr. Graham Page: I beg to move, in page 90, line 8, after 'force' to insert:
'on such date as the Treasury may order'.
If it would be convenient to the Committee, we could discuss with this Amendment the next, in line 10, leave out '1968' and insert:
'next following the date of the Act coming into force'.
for they are closely related.

The Deputy Chairman: If that is for the convenience of the Committee? I think it is.

Mr. Graham Page: I am much obliged.
As the Bill stands, it comes into force in the fiscal year 1968–69, but it is only a part of the consolidation of the Income Tax law which, I understand, is to be pat before the House in due course by the Government. This Bill merely lifts a few Sections and some parts of Schedules out of the Income Tax Act, 1952, a consolidation Measure. The question arises whether it is wise to bring this in piecemeal at this stage, without consolidation of the whole Act.
I raised this point on Second Reading in the form of asking whether this was an instalment in the process of consolidation in Income Tax law. Indeed, it is, of course, one of the major tasks of Parliament, I would have thought, to consolidate the Income Tax law so that it is in a simple form for further revision as occasion arises. The answer which I received from the hon. and learned Gentleman at the time was rather disturbing. He said, yes, this is an instalment of consolidation in Income Tax law, but he did not wish the House to be misled by thinking we were to have a

complete consolidation Measure relating to Income Tax. He said:
I do not want there to be any misunderstanding arising from what I have just said. It is not the intention that this Capital Allowances Bill, when it becomes law, will at a later stage be as it were re-consolidated into a new consolidation Measure, but I do not think that is what the hon. Member had in mind."—[OFFICIAL REPORT, 19th January, 1968; Vol. 756, c. 2163.]
Indeed it was what I had in mind. I had hoped that the intention was eventually to produce another consolidation Measure such as the Income Tax Act, 1952, which has been of very great practical use, and will not be nearly so valuable if it is reproduced in a number of new editions scattered over various volumes dealing with various parts of the law. Again I would ask the hon. and learned Gentleman before we pass this Clause and the Bill comes into operation for the next financial year that he would give an assurance to the Committee that it is intended to produce a completely new volume of consolidation of Income Tax law and not just piecemeal chapters scattered about so that there is just as much difficulty in finding the law as if it had never been consolidated.

The Solicitor-General (Sir Arthur Irvine): The effect of this proposal, if it were accepted by the Committee, would be to bring the Bill into force on an appointed day, and that, in my submission to the Committee, is not an acceptable proposal. If there were any material change in the law between now and the appointed day the result would be merely to postpone the operative date of a consolidation which the House has already approved by giving to this Bill a Second Reading. If, on the other hand, such substantial changes did take place as the hon. Gentleman has brought forward as a possible event then the Bill would not be a proper consolidation of the law in force on the appointed day. I think that really he is in a very difficult dilemma on that point, and I do not quite see how he can get out of it.
The choice before the Committee is either to pass the Bill with its existing commencing date or to throw it out altogether; in which case it would, no doubt, be reintroduced together with


the consolidation of the remaining provisions of the Income Tax code which is now being prepared. It could, however—as I pointed out in my Second Reading speech—possibly then be argued all over again that, in view of the possibility of future changes in the law, it would still be the wrong time to consolidate.
If the principle which lies at the back of the Amendment—to grace it with the name of "principle"—were accepted, that would have the effect of making consolidation measures haphazard and sporadic to a degree which I could not recommend to the Committee. The Amendment is inconsistent with the other provisions in the Bill, which are expressed to come into force on 6th April, 1968 for all purposes. The substance of my reasoning in asking the Committee to reject the Amendment is that to concede the hon. Gentleman's point would be to admit into the process of consolidating the law, which hon. Members on both sides desire to see advanced, wholly undesirable hazards, risks and delays.

Mr. Graham Page: All that I had hoped for from the right hon. and learned Gentleman was an assurance that the Income Tax law would be consolidated as a whole and that we would not have, over a period of years, little pieces taken out of the 1952 Act and presented in this form. This would only confuse the law more and more because when we eventually get to the later chapters to be consolidated, the first ones will be out of date and we will have to begin amending them. This is the difficulty in piecemeal consolidation and that is why I urged the right hon. and learned Gentleman to assure the Committee that the whole of the law would be consolidated and that we would have it all in one volume.

Amendment negatived.

Clause ordered to stand part of the Bill.

Clause 97.

(CONTINUITY.)

Mr. Graham Page: I beg to move, in page 91, line 24, to leave out from 'Act' to the end of line 25.
Subsection (6) begins by saying:

In this and the next following section 'the repealed enactments' means the enactments repealed by Schedule 11 to this Act …
That is straightforward. One has only to turn to Schedule 11 and there they are set out. But there follow in the subsection these unintelligible words:
… and such of the enactments repealed by the Income Tax Act 1952 as correspond to the provisions of that Act so repealed.
I could not understand what that meant. Whether "so repealed" refers to those repealed by this Bill, or the Income Tax Act, 1952, I do not know; although I gather that it must mean those repealed by the 1952 Act. On that assumption, the Government seem to assume that if they repeal one Act, they thereby revive anything repealed by that Act. This is saying that what was repealed by the 1952 Act shall not be revived now that we repeal the 1952 Act. According to Section 11 of the 1889 Interpretation Act, it does not revive them, and therefore, if these words are left in the Bill, they will show the present Government's ignorance of the existing law.

The Solicitor-General: It grieves me that the hon. Gentleman should torment himself with matters of this kind and the kind of arguments he has just addressed to the Committee. This Amendment arises relevant to Clause 97, which is the Clause having the purpose of ensuring that continuity of the operation of the Income Tax Acts and the Corporation Tax Acts shall not be affected by the substitution of this Bill for the repealed enactments. If anything in the repealed enactments has relevance, the continuity of that relevance must be preserved, and the preservation must be spelt out in the Bill. That is all that the Bill in its present form does.
The Bill is concerned with depreciation allowance for capital expenditure on industrial buildings, machinery and plant, mines, and matters of that kind. In all these things, writing down allowances may still be running on expenditure incurred before 6th April, 1952, when the Income Tax Act of 1952 came into force.
Even where such expenditure has been fully written off, if the asset is sold or put out of use after the coming into force of the present Bill it will be necessary to have regard to the amounts written off for years before as well as


after the 1952 Act came into force in order to establish, in the case of a sale, that a balancing charge should be made on the ground that the sale price exceeds the original cost less the amount written off or, if the asset is scrapped, that the expenditure has been fully written off and no balancing charge is due.
What it comes to is that these pre-1952 provisions of the law are relevant still in determining these balancing charges and in deciding the matters to which I have referred, and it is necessary, in order to effect satisfactory consolidation, that it should be made perfectly clear that these provision still take effect.

Mr. Graham Page: With great respect to the hon. and learned Gentleman——

Mr. John Wells: Mr. John Wells (Maidstone) rose in his place and claimed to move, That the Question be now put; but The CHAIRMAN withheld his assent and declined then to put that Question.

Mr. Graham Page: I wish to be serious for a moment, if I was, perhaps, a little flippant in moving the Amendment.
The Solicitor-General has been addressing himself to subsection (1) of the Clause, and not to subsection (6). It is quite true that subsection (1) provides for a continuity of the operation of the Income Tax Acts, but what is said in subsection (6), and quite deliberately said, is that the enactments which were repealed by the 1952 Act—those corresponding to those repealed—are not to be revived. That is as I read the last two lines of the subsection, and this is absolutely unnecessary.
The Interpretation Act said that where an Act passed after 1850 repeals the repealing enactment it shall not be construed as reviving an enactment that has been previously repealed. That is what the subsection says there again, and quite unnecessarily. As the hon. and learned Solicitor-General wished to refer to precedents in connection with the previous Amendment, I say that this is setting a very bad precedent in consolidation Measures.

Amendment negatived.

Clause ordered to stand part of the Bill.

Clauses 98 to 100 ordered to stand part of the Bill.

Schedules 1 to 12 agreed to.

Bill reported, without Amendment.

Motion made, and Question, That the Bill be now read the Third time,put forthwith, pursuant to Standing Order No. 55 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, without Amendment.

SEWERAGE (SCOTLAND) BILL

Order for Second Reading read.

Motion made, and Question put (pursuant to Standing Order No. 62 (Public Bills relating exclusively to Scotland)), That the Bill be committed to the Scottish Standing Committee.—[Mr. Ross.]

Question agreed to.

Bill (deemed to have been read a Second time) committed to the Scottish Standing Committee.

SEWERAGE (SCOTLAND) [MONEY]

Queen's Recommendation having been signified—

Resolved,
That, for the purposes of any Act of the present Session to make new provision as respects sewerage in Scotland, it is expedient to authorise the payment out of moneys provided by Parliament of any increase attributable to the said Act in the sums payable out of moneys so provided under any other Act.—[Mr. Ross.]

INDUSTRIAL TRAINING (AGRICULTURE, HORTICULTURE AND FORESTRY)

10.46 p.m.

Mr. John Wells: I beg to move:
That an humble address be presented to Her Majesty, praying that the Industrial Training Levy (Agricultural, Horticultural and Forestry) Order 1967 (S.I., 1967, No. 1747), dated 23rd November 1967, a copy of which was laid before this House on 1st December, be annulled.
I do not intend to divide the House on this Motion because, with the large Government majority, nothing would be


achieved by voting. I hope, however, that the Parliamentary Secretary will realise the extreme hostility there is to this Order. Even at this late stage, I hope that if it is not withdrawn tonight there will be further discussions with the National Farmers' Union and a real examination made of the measure.
In 1964, the N.F.U. labour committee examined the future manning of the agricultural industry and produced some sensible tentative suggestions that some sort of board should be set up under the Industrial Training Act. The committee, quite rightly, had been trying to encourage apprenticeship. In farming there is an intake of only about 3 per cent, by way of apprenticeship compared with 25 per cent, in other industries. Consequently, the existing members of N.F.U. apprenticeship committees became a sort of specialist enthusiastic elite. County branches of the N.F.U. were consulted as no one knew what the proposals were, but consultation was of a most perfunctory nature—I can speak of this for my own county.
It was decided to establish some sort of board, but at no point was the farmer in the field consulted about the Board that has been forced on him. The ordinary farmer is worried by the composition of the Board. The nine employers' members, who are enthusiastic anyway, can be outvoted by the nine workers' and six educational representatives, who are seen to be complete theorists and also as empire builders.
The Board should be seen against the background of the total labour force in farming. This has declined rapidly in recent years. In June, 1965, it was 450,500 compared with 771,700 in 1945. The bulk of the wastage is in the age groups between 20 and 50. Below the age of 20 agricultural wages are still attractive, and over 50 it is difficult for a man to change his way of life. Consequently, if farming is to have a stable modern labour force, they must be properly trained, but when they are trained they must be able to be paid a sufficient wage to help keep them in the industry.
It is absurd to ask farmers to pay £6 a head for every man they have in order to train men to go and become motor mechanics in the local town. Training is

needed, but let it be realistic and not just another piece of bureaucratic nonsense run by theorists. The statistics of education for 1965 tell us that there were then 8,991 full-time students and about a further 6,000 on day release, giving a total of over 15,000 persons enjoying an agricultural education. The Pilkington Report shows that a year earlier about a quarter of those recruited to the industry had some sort of vocational training.
From these figures it will be seen that the existing county farm institutes do a good job. Why not let these county institutes continue but add some technical training, as opposed to pure education? The county institutes are now by no means full, and new training courses could easily be organised by a more modest board. Commercial concerns such as tractor and chemical manufacturers often offer extremely good practical courses which supplement the more theoretical institute courses.
The overbearing cost of the Board is the greatest complaint of the ordinary farmer. Why was not a more modest pilot scheme such as has been mentioned for East Anglia put up in the first place? I realise that the East Anglian scheme is not regarded by the Board as a pilot scheme but as something more thorough still than the main scheme. Is it too late even now to have a pilot scheme until the concept is better understood?
Turning now to part-time workers, the Board's questionnaire about part-time workers was both confusing and alarming to many, especially to horticultural growers. The fact that the Board has made no levy this year on part-time workers gives no comfort for the future. On this point I should be glad to have a categorical assurance from the Parliamentary Secretary.
Many special categories of employer can never get any benefit from the scheme and should be exempt. I have in mind those in remote areas and certain highly specialist horticultural producers, such as watercress and mushroom growers. Horticulturists are particularly hostile to the Order. Let me give a brief example. In the same county—Lincolnshire—two men farm similar acreages. One man grows bulbs and will have to pay a levy of about £1,000 and will get virtually no benefit, whereas his neighbour and friend who is a mixed and


arable farmer will pay £60 a year and get some benefits. I give another example of the horticulturist's problem: in the Lea Valley about 75 per cent, of the horticultural labour force speak no English. It is absolutely absurd that these people should be assessed for levy. Apart from the residence of the Prime Minister, what is the position of the Isles of Scilly?
I was minded to say something about the absurdity of the Y.M.C.A. episode, but the shortage of time makes me skip that. I would merely say that, if the Board had treated the Y.M.C.A. episode as a publicity venture, it would have been more useful and more rewarding than the absurd hand-outs at great cost that come from the Board's publicity consultants. This firm of consultants costs the farmers good money to dish out these hand-outs. One would imagine that the hand-outs should be perfect, but one has come into my hands which is riddled with mistakes. These people who are being hired at considerable cost should be accurate.
Again, the farmer in the field is extremely hostile to the costly appearance of the Board's publications. Many farmers are horrified at the £6 levy. On top of that, they see on pages 2 and 3 of the Board's second bulletin the head-line, "This is only the start". This sort of promise of worse things to come is not likely to encourage farmers to pay promptly.
There is little doubt that there will be many slow payers. If through non-payment the Board becomes insolvent, will the Government wind it up; or, alternatively, will they put it on to the shoulders of the general taxpayer? It is noticeable that the fines for non-payment of the levy are very high—£100 for the first offence and £200 for second and subsequent offences. I realise that these were fines provided in the parent Act; suitable no doubt for great industrial concerns, but a very different kettle of fish for a small farmer.
Although the N.F.U. and the Board have, I understand, asked the Government for finance for a second year, I hope that the Government will resist this and not waste the taxpayer's money on a grandiose scheme which is unwanted by the bulk of the farming industry. If any general finance is to be provided by the

Government, might it not be better for it to come out of Price Review moneys? This would clearly help the Board by saving it chasing slow and unwilling payers. It would help those sections of the industry such as horticulture which gets little from the Board and fears that it may pay much. It would remove from the Board the moral responsibility of providing odd special courses because special producers had been forced to pay the levy. The small farmer who employs one man or even two men cannot spare them for part-time training. These people are the backbone of British farming, and many view them as the backbone of Britain. Why should they have to pay £6 a year, and maybe more in the future——

Mr. Kenneth Lewis: If my hon. Friend will allow me, he mentioned a sum of £6 a year. I hope he realises that the £6 referred to in this Order finishes in August, 1968.

Mr. Wells: I am grateful to my hon. Friend. I think I said they would have to pay £6 and more in the future.
Why should these people have to help their larger neighbours to some thoroughly nebulous advantage? If the Government are unwilling to reconsider the finance, then the levy should be reduced. All farms with less than three men should be exempt and the activities of the Board cut down to fulfil a real need.
The Board is currently trying to get some emotional support for offering special training in foot and mouth areas. I shall be glad to know just what training would be relevant in dairying Cheshire or some steep stock rearing areas. Farmers who have spoken to me about this scheme are not impressed.
I have heard the unacceptable and pathetic excuse that the Board has been unable to "sell" itself owing to cancellation of farmers' meetings because of foot and mouth disease. The Board will never sell itself to the ordinary farmer. It should give up its grandiose plans and come down to earth. The parent Act may be good for industry, but it is unsuitable for agriculture. Any training in agriculture with its vast number of small employers should be tailor made to their requirements, and not come in such a badly fitting ready made suit.

Mr. Speaker: Order. We cannot amend the parent Act on this Order.

Mr. Wells: I am grateful for your help, Mr. Speaker.
What I would seek is that this Order be rejected and that new legislation be introduced if need be to cover a more suitable scheme for agriculture.
I have just been handed this telegram addressed to me, which reads:
Reported that Welsh farmers union have rejected officially the Agricultural Training Board.
I have unfortunately not yet been able to check this statement, but if it is true I have little doubt that Wales is only leading the way for England.
I therefore oppose the Order and, although I cannot vote against it, I hope the Parliamentary Secretary will reconsider it most urgently.

10.59 p.m.

Mr. Bert Hazell: I very much regret that the Opposition seek to annul this Order. The Agricultural Training Board has been established just over 12 months, on the joint application of the National Farmers' Union and the workers' organisations. Indeed, the National Farmers' Union was very much to the forefront in taking the initiative in discussions with the workers' unions for the purpose of creating some such board.
As has already been said by the hon. Member for Maidstone (Mr. John Wells), prior to the establishment of the Board there was within the industry an agricultural apprenticeship scheme. This was on a voluntary basis, and, as a consequence, the scheme never really got off the ground. It is true that in some counties a number of young lads did become apprentices, but, in the main arable belts very few lads took advantage of the scheme. Nor were they encouraged so to do by their employers. An analysis of the figures for those who have entered the scheme shows that most of them came from the towns and cities, and many of them, after taking their apprenticeship, did not stay in the industry.
The farming community has for a long time recognised the need for an adequate and more efficient training system for the young in particular and

for workers on the land in general. Less than 20 per cent, of young entrants into agriculture undergo any form of training. Agriculture itself has undergone radical changes in recent years. This emphasises the need for all workers, except, perhaps, the most elderly, to have some form of instruction. Adequate training can and will have the effect of creating higher productivity, reducing the maintenance costs for farm machinery and equipment, reducing the accident rate, which is substantially higher in agriculture than in many other industries, and giving the worker a greater and better appreciation of the nature and purpose of the work which he has in hand.
Sixteen thousand new young entrants enter agriculture each year. It is estimated that of these 10,000 boys and about 2,000 girls stay put. But it is unlikely, according to the figures, that more than 10 per cent, of these receive any formal training. In the agriculture industry, therefore, we recognise that training is essential. Moreover, as the future pattern will see—as it has in recent years—a diminishing labour force in the industry, it is more than ever essential that those who are retained are highly skilled personnel.
The Board was not foisted on the industry. It was amply discussed at county and national level. [HON. MEMBERS: "No."] Publicity was produced extensively through the Press, the farming journals and the radio, and, when application was made to the Minister of Labour for approval of the proposals, again substantial publicity was given to it.

Mr. Speaker: Order. We cannot on this Order discuss the fact that the Board exists. We are discussing a levy to help the purposes for which it exists.

Mr. Hazell: But, with respect, Mr. Speaker, the functions of the Board in the future will depend on its ability to raise the necessary money, and it is to that that I am addressing my argument. Hon. Members opposite have said that the Board did not receive publicity. 1 cannot do better than quote from today's Daily Mail. In reply to a suggestion that there should have been a ballot taken by the National Farmers' Union and the further suggestion that
when a farmer receives his demand for the levy of £6 a worker he should post it to the


secretary of his N.F.U. branch, stating that he never associated himself with the scheme
the N.F.U. is reported as stating:
The Union received an overwhelming man date from county branches for the principle of establishing a board"——

Hon. Members: Nonsense.

Mr. Hazell: —
Members were informed through the union ournal in July 1966"—

Several Hon. Members: Several Hon. Members rose——

Mr. Speaker: Order. With all the good will in the world, the hon. Gentleman cannot give way to four hon. Members. He has not even said that he is giving way to one yet.

Mr. Hazell: Thank you, Mr. Speaker. The report states:
Members were informed through the union journal in July 1966, when full details of board activities and forecasts of levies were published. Not a murmur of dissent was received from the present objectors".
That appeared in today's Daily Mail.

Mr. Paul Hawkins: Has the hon. Gentleman read this morning's Eastern Daily Press, in which it is reported that the Norfolk branch of the N.F.U. has unanimously come out against the Training Board?

Mr. Hazell: I have read what the Norfolk branch has said, but I have just quoted what appeared officially on behalf of the N.F.U. in this morning's Daily Mail.
The Board has not been able to get on with its campaign because of foot-and-mouth disease. But now that the disease is fading—and we hope that it will soon disappear—there is a definite assurance that the Board will start its active campaign of informing farmers and others concerned of its needs, plans and policies, and will at the same time express to farmers' organisations the purposes of the levy and how it is being used.
When the Board decided on the basis of a levy it originally decided that it would apply in respect of paid employees. Subsequently the Board retracted over part-time labour. I am sorry that it did; perhaps the over-all levy might not have been quite so high. All decisions about staffing, organisation and amount of levy were taken jointly by the N.F.U. and the National Union of Agricultural Workers,

and at each stage the N.F.U. representatives, like my own union representatives, consulted their parent organisation. It is not correct to suggest that the N.F.U. was not fully acquainted of every step the Board has taken through its representatives on the Board.
The Board is required by Statute to make a budget and in its preparation the Board has made three sections. First, to estimate the cost of grants to farmers for training; second, the cost of the training the Board will have to undertake; and, third, the cost of the Board's administration. It has been estimated by the Board that half the money raised will return to farmers by way of grants to train their employees. A quarter will be for the purpose of supplementing, through the Board's national field officers, the training the farmers will be unable to undertake, and the other quarter will go in administration costs. When one realises that 100,000 files will have to be maintained and kept up to date, one sees that this will be no small problem for the Board. Money will be needed to bring its administration up to date and keep it up to date.
The essential point for young workers is to receive proper training to enable them to qualify for plus rates, because, side by side with the work of the Training Board, we are working out on the Agricultural Wages Board details of a wages structure. The main basis of payment under it will be qualification through adequate training, shown by the granting of a certificate through the Training Board.
I therefore hope that the rather loud, vociferous attitude adopted by what I believe to be a minority of fanners against the Board will soon subside, and that we shall see it carrying out its proper function of efficiently training skilled young men for the future of British agriculture.

11.10 p.m.

Mr. Peter Mills: It is very unwise to bring the Order forward at present. The imposition of another levy on agricultural employers is another burden when this great industry is already carrying burdens that are far too heavy. The levy is bitterly resented by most farmers.
It is no good the hon. Member for Norfolk, North (Mr. Hazell) saying what he


did. He should visit the South-West to appreciate how strongly the farmers feel about it. It is not often that I criticise the National Farmers Union, but, frankly, I feel that it is out of step in what it has done at the national level. Its members are not with it on this, and this it will find out as the years go by.
The burden of legalised extractions from farm receipts is growing all the time. One has only to think of the amount that is taken from our milk, eggs, cereals and wool, for P.I.D.A., for the Hop Board and the Apple and Pear Council, and now a Meat Commission is coming along, to realise what a burden it is. Now we are to have the training levy. I believe that the Government have gone too far. I do not believe that many small farmers can bear the burden, and I think the time has come when farmers generally will say "No. No more." They cannot bear this burden very much longer, particularly the small farmers. When one looks into the levy and into what the Training Board has to offer, it is nonsense. Take a farmer at Chagford or Moretonhampstead, miles away from anywhere. What help can he possibly get from this? Yet he has to pay the levy.
The Board should be looked at very carefully. Every penny it spends must be checked before we pay the levy. Every item must be looked at. When one thinks of nearly £500,000 being spent on administration it is very sad. One can compare this cost of administration with that of other training boards. There are the training boards for the hotel and catering industry, the iron and steel industry and the engineering industry, and the last one, the largest of all, is paying out £70 million in training grants but spends only £1·3 million on its own payroll. The Agricultural Training Board does not compare with those. It shows how poorly it has been set up.
Mr. Neame's Board, with an estimated levy income of £1·7 million, expects to spend nearly half of it on its administration and advisory payroll and on the Board's own capital projects. This is not good enough. We must look at the Board very carefully before we pay the levy. I know the need for training in agriculture, but is the Board really necessary when we have the very adequate training schemes

through our farm institutes and the day release arrangements? Surely these should be improved and encouraged.
Unless these problems are cleared up and unless there is co-operation with the industry, the Training Board will never really work. I ask the Government to look at this again very carefully before there is any thought of our paying the levy.

11.14 p.m.

Mr. J. B. Godber: I rise only for two minutes, because I know how many hon. Members want to speak, but I felt that I must make two points to the Parliamentary Secretary.
First, I was the Minister responsible for introducing the Act under which the Agricultural Training Board was set up. I want to make it clear to the House that the Government of which I was a member looked on the Act primarily as one for dealing with industry generally. The Parliamentary Secretary will be well aware that Section 1(4) of the Act said that the Minister would have full consultations with any industry before setting up a board. It is permissive as to whether he sets up a board for an industry or not. But, as Mr. Speaker will remind me quickly, we are not discussing whether a board should be set up; we are discussing a levy Order under the Board.
I feel that I should make it clear that it was no initiative on our part that the Board for agriculture was set-up, but set-up it was, by the present Government, with the best intentions, and presumably the hon. Gentleman will tell us that this was done after consultation with both sides of the industry. Now we are dealing with what the Board is actually doing, and that is what is worrying my hon. Friends. Apparently, it is undertaking large scale work which means substantial imposts on farmers. What is worrying my hon. Friends is not so much the cost but that it would appear that the Board is duplicating work already done.
From my constituency, I have details of the extra-mural courses at the Agricultural College there which cover many things that the Board is seeking to do. No farmer wants to see things paid for twice over, particularly if he is having to foot the bill. The hon. Gentleman has


a problem, and I suggest that the way to handle it is to get the Board—if he is prepared to withdraw the Order, as I hope he is—to spread the cost over a much longer period so that it will not apply merely to one year.
The hon. Gentleman should seriously consider withdrawing the Order and getting the Board to introduce a more modest scheme more in keeping with what the fanners want. Farmers and representatives of the farm workers are on the Board and it should be up to the representatives of the industry to make clear to the Board what they want in the form of training facilities. If they do, and the Board respond properly, there may well be functions for it to carry out. I hope that the hon. Gentleman will deal with that aspect.
Mr. Speaker, we were not able to begin this debate until 10.46 p.m. and a large number of my hon. Friends are deeply concerned about how the Order may affect their constituents. By the allotted time, we shall not have had time to rehearse all the points properly, and I beg you, at 11.30, to use your discretion, for which there are precedents, to defer further consideration so that we can continue the debate another time.
My hon. Friends are genuinely concerned to represent the views of their constituents, and I am sure you wish them to have the opportunity to put their views. I ask you to rule on this point. I shall take no further time. I have expressed my view that the Act was right and that the question before us is whether the Board is acting in the best way for farmers. Many hon. Members here say that it is not. It is for the Joint Parliamentary Secretary to justify it fully if he expects this Order to be approved by the House.

Several Hon. Members: Several Hon. Members rose——

Mr. Speaker: Mr. Hattersley.

The Joint Parliamentary Secretary to the; Ministry of Labour (Mr. Roy Hattersley): The Joint Parliamentary Secretary to the; Ministry of Labour (Mr. Roy
Hattersley)  rose——

11.19 p.m.

Mr. James Scott-Hopkins: On a point of order, Mr. Speaker. M3' right hon. Friend the Member for Grantham (Mr. Godber) has drawn your attention to the fact that there has been very little time for this debate and that

many of my hon. Friends still wish to take part. Once the Joint Parliamentary Secretary gets up we know that the debate is virtually finished. It is within your discretion to allow us further time.
May I draw your attention to the precedent established on 25th February, 1965, when you were Deputy Speaker? There was then a Prayer against a Statutory Instrument dealing with plant varieties. The debate began at 10.43 p.m. This debate began at 10.46 p.m. In your wisdom, when 11.30 came on that previous occasion, you said you were of opinion that the time for the debate had not been adequate and adjourned it. About the same number of hon. Members had spoken then as tonight. This is an exact parallel. We have not had sufficient time.

Mr. Speaker: It is embarrassing for the Chair to be overwhelmed by advice from hon. Members on both sides of the House.

11.20 p.m.

Mr. Hattersley: The right hon. Member for Grantham (Mr. Godber) rightly says that the Levy Order springs naturally from the existence of the Agriculture, Horticulture and Forestry Industrial Training Board. The Board itself springs equally naturally from the legislation which bears the right hon. Gentleman's name and for which he deserves a great deal of credit. I have always taken the view that one of the important things about that legislation was the welcome with which it was received by both sides of the House, and I am always happy to give credit to the right hon. Gentleman and his right hon. Friend the Member for Mitcham (Mr. R. Carr), who started it all with the Carr Report, for what they achieved.
The right hon. Gentleman said that any discussion of this levy order concerns an area of activity which his Government did not necessarily regard as appropriate for industrial training of this sort. But I have to remind him that his Government, as mine, had a series of criteria which they observed when they decided which industries should have training boards. Two of the criteria were the quality of training in the industry before the creation of a board and the desire of the industry that a board should be created.
I hope shortly to be able to say something about the facilities which were available for training in agriculture before the Board was set up. In the Board's view and in mine, they were in general inadequate. However, I want to begin by saying what was the attitude of the industry to the creation of a board when the Board was created in 1966.
On 13th April, 1965, the National Farmers' Union wrote specifically to my right hon. Friend asking that a board should be created under the terms of the 1964 Industrial Training Act. With all respect to hon. Members and to you, Mr. Speaker, we ought not to comment on, or make judgments about, the internal democracy of the National Farmers' Union. Its leadership put it to us that a Board was necessary. We accept it as the view of their union. It also put the point that many associated organisations, like the Scottish National Farmers' Union and the trade unions involved also wanted a board.
It was appropriate and inevitable that my right hon. Friend should respond to that request. It was inevitable that when he did so he should set up a board which would produce a levy and a levy Order which he or I could commend to the House in the knowledge that it was initially recommended by Board members who had practical knowledge of and practical experience in agriculture. I must express my personal regret that the hon. Member for Maidstone (Mr. John Wells) chose to speak as he did about individual members of the Board. I hope that none of the members of the employers' side are ever subject to more severe criticism than it being said that they are enthusiasts for their jobs. I would have thought that that was a qualification for being on the Board rather than a criticism. To say that they are people without practical experience of farming is, of course, absolute nonsense. As the hon. Gentleman knows well, the Chairman, to take only one example—although similar things could be said about all the members on the employers' side—is himself a substantial farmer with substantial farming experience.

Mr. John Wells: I did not say that the employer members had no practical experience.

I was speaking of the theoretical educationists.

Mr. Hattersley: I shall come to that, but certainly the majority of the board, employers and employees, are people who know about agriculture, who have spent their lives in agriculture and who in my certain knowledge are respected in the industry. They were appointed to the Board only after close consultation with the National Farmers' Union, the Agricultural Workers' Union and the Transport and General Workers' Union. Many of the attitudes which they represent and many of the things which they say about training are points of view to which, I am sure, the hon. Member for Maidstone would strongly subscribe.
For instance, they have publicly pointed out the importance of training being run by men of experience in the industry. They have said that their object is to ensure that training is run for practical reasons—to increase profitability and to increase productivity—and they have specifically said that they believe that the interests of the industry are best served if the training is run by people with practical knowledge rather than by people whom they choose to call—and I do not complain—"Whitehall bureaucrats". Having decided that they want to run it in this practical and material way, they need to make sure that they are able to receive sufficient finance to make that possible.
In the first year, they were helped in their administration costs by a payment from my right hon, Friend of about £300,000 for that purpose. In the second year, it became essential that the Board stood on its own feet in an industry in which I gladly concede it is particularly difficult to organise training. The hon. Gentleman knows better than I do that there are in the industry 330,000 employees, 140,000 establishments, 46,000 establishments with only one employee and 130,000 establishments with less than five workers. It was inconceivable that the Board could operate were it to exclude from its provisions the small farmers. If they were not in, virtually no one was in——

Hon. Members: Why?

Mr. Hattersley: If hon. Gentlemen will contain themselves I will tell them. It also makes it difficult for training to be organised, when farms are scattered throughout the country, when they are occasionally inaccessible and when the entire working year has to be geared to seasonal factors. Because of that the Board, rightly in my view, chose to organise in such a way that training was available in the county, locally, and run from local advisory committees, rather than from London.
That meant that the Board decided to appoint 47 training advisers—that number will be appointed by the end of February—to work in the country, giving practical advice to farmers, doing the job which needed to be done. The cost was very substantial. But their appointment was vitally necessary.

Mr. Peter Emery: Could the hon. Gentleman say whether either side, during the passage of the Industrial Training Act, ever envisaged that 25 per cent, of the levy should be on administration? Would he, therefore, say whether he thinks that that degree is correct at this time?

Mr. Hattersley: There is a very bogus distinction drawn between administration and other costs.
The Board is required to administer training in the industry, which as I have told the House, proves particularly difficult, because of the size and number of its establishments.

Mr. Michael Noble: I am grateful to the hon. Gentleman for giving way, because I know that he is pressed for time. He said that the training should be involved in the immediate areas. There is no possibility of training in some areas in my constituency, and in many other areas of Scotland.

Mr. Hattersley: I have to tell the right hon. Gentleman that that is not the view of the Board—a Board specifically appointed to give that sort of advice. It does not believe that there is any area of its responsibility for which training is inappropriate. It may be that the right hon. Gentleman or some of the farms that he knows do not train according to the specifications of the Board. If they did they would be eligible for the grant.
The hon. Member for Maidstone talked about the emotional support that the Board had tried to rouse because of its emergency training to meet the foot-and-mouth epidemic. I pass on from that in the belief that he will regret what he said when he reads it in HANSARD tomorrow. What is certainly true is that the courses of training appreciation and meetings to encourage the acceptance of training, indeed the entire training programme mounted by the Board this year, has been held back and minimised because of the foot-and-mouth epidemic.
I will give two examples. Of the 50 appreciation courses, 44 were concelled, and of the 37 public meetings planned to take place to talk about training 23 were cancelled. Under those circumstances it was absolutely inevitable and it is proper that I should make plain now that the Board and the N.F.U. had come to my right hon. Friend and asked him that the grants for administration expenses, which are normally only paid for a single year, should be carried on into the Board's second year.
I have to make it clear that my right hon. Friend and the Minister of Agriculture are at this moment considering the Board's application that some specific financial assistance should be given which would enable, for a temporary period, the levy to be reduced from the £6 figure. It is impossible for me to give any indication to the House this evening of how the application would be treated, but I ought to make it clear that a request has been made. While that request is under consideration the Board must continue to exist, because it is in the interests of the industry, and it can only continue if it is financed by levy. It must be financed by the Levy Order which I commend to the House now.

11.29 p.m.

Mr. J. M. L. Prior: In the very short time that is left, I would like to ask the Parliamentary Secretary why, in view of the remarks that he has made in the last sentences of his speech, he has not thought fit to withdraw the Order. After all, he has now left us in the worst of both possible worlds, because he has in many respects, conceded the case——

It being half-past Eleven o'clock, Mr. SPEAKER, being of opinion that, owing


to the lateness of the hour at which consideration of the Motion was entered upon, the time for debate had not been adequate, interrupted the Business, and the debate stood adjourned till tomorrow, pursuant to Standing Order No. 100 (Statutory Instruments, &amp;c, (procedure)).

INDUSTRY (AMERICAN INVESTMENT)

Motion made, and Question proposed, That this House do now adjourn.—(Mr. Varley.)

11.30 p.m.

Mr. E. S. Bishop: I am grateful for the opportunity of calling the attention of the House and of the Government to the effect of American investment in British industry. At the outset I want to make it clear that I am not opposed to foreign investment in principle; I am not against American investment in British industry. I believe there are advantages as well as disadvantages in it. Foreign investment, as we know, has often introduced new techniques into our industry and brings about new employment for our people. Indeed, in Scotland it is estimated that since the war something like 50,000 jobs have been found resulting from American investment there. With investment of United States capital totalling about £2,000 million and providing jobs for over 400,000 British workers none can say that such investment has only disadvantages. In my own constituency in Nottinghamshire, indeed, in every constituency in the country, hon. Members know that there are firms which are American controlled where our constituents are employed, and that our constituents use products and consumer goods which have been provided by these firms.
The proud descendants of the Pilgrim Fathers and their friends have been returning in a massive procession to our shores over the years, while some of my hon. Friends have been gazing across the Channel looking for links with Europe, and during this time some of our cousins in the New World have been coming in by the back door into this country. They are visitors we welcome, of course, but at times we wish they would not always wear their boots when occupying our industrial and commercial beds. However,

there is no doubt at all that American investment in this country is quite substantial and, as I said, it brings advantages and disadvantages as well.
I want briefly to deal with the motor industry in general and one or two points in particular. In doing so, when I look at the disadvantages, I have a very distinguished precedent, of course, is so far as the present Prime Minister, when he was on the Opposition benches, moved the Adjournment of the House in 1961 on the occasion when Ford of America took over Ford of the United Kingdom. That expression of concern about the possible effects of the takeover on the future of our economy was quite real, and my right hon. Friend alleged that the then Government had acted irresponsibly, with too little concern for the national interest, and asked what would be the result if the American motor industry were plunged into a recession, and what effect there would be on British commercial prospects if the world market for cars became more competitive.
These questions are still relevant today, and I should like to know what the present Government think about the answers at a time when we have here three United States controlled firms which produce over half our cars. Having been engaged on aeronautical design for some years I have some interest in the engineering industry.
Like many unions, the Draughtmen's and Allied Technicians' Association, of which I am a member, has been concerned about the effects of the transfer, or possible transfer, of work fom the United Kingdom to the Ford of Europe Company and the future prospects of the Main Design Centre of Ford in Britain at Dagenham and Dunton. Having expressed my concern for many months, the Parliamentary Secretary to the Ministry of Technology told me on 25th August, 1967, that the two Ford manufacturing companies in Britain and Europe had reiterated the assurance that Ford of the United States had given to the Chancellor of the Exchequer in 1960 concerning employment policy and so on.
Despite this, the fears which have been, and are being, expressed, have not been allayed. Following further representations made to the Minister of Technology, my right hon. Friend told me on 18th January last in a letter that Ford Europe


was created to carry out the functions previously carried out at Detroit, that it does not produce, design or sell anything, that its job is to counsel, advise, inform and help on an international basis, that the executive functions will, however, remain with the subsidiary companies in Britain and Germany, and that Ford Britain will continue to design its own cars, though it will naturally draw on Ford experience in Europe in co-operative design work.
The Minister claimed that it does not follow that Ford Britain will necessarily need fewer engineers, designers and research workers in the future than it needs at present. He claimed that the rumours of the possible transfer of work from Dagenham to Europe and the apprehensions which have been part of Ford's life in the past four or five years have no real foundation.
This situation is bound to result from firms whose control is outside this country and whose international connections and ramifications quite naturally lead to fears for the future of those employed by them. These fears arise from the fact that we have not safeguarded the principle of national control of important industries.
In the 1961 Adjournment debate to which I referred, the present Prime Minister said that employment at Dagenham should be governed by the kind of foreign trade policies of which the House of Commons approved. He added that a number of other countries, including Holland, Switzerland and the Scandivanians, safeguarded the principle of national control of important industries. He declared that we were against a major industry being owned by the Americans; and a similar sentiment was expressed by the then Opposition spokesman on trade matters, who until recently was the President of the Board of Trade.
Since then, we have had the Chrysler Corporation of the U.S.A. acquiring a substantial minority in Rootes Motors. The T.U.C., while not deprecating bona fide foreign investment in British firms, has deplored the infiltration of foreign capital for the purpose of acquiring control in key sectors of the British economy.
The 1967 annual conference of the Confederation of Shipbuilding and Engineering Unions adopted a resolution expressing concern at the increasing penetration

of American capital into British engineering, and while recognising the advantages of access to certain fields of advanced American technology, was apprehensive at the surrender by British engineering of its responsibility to maintain its research and development, especially in the science-based, growth industries.
Apart from the fears to which I have referred, there is apprehension about the future of Short Bros, and Harland, and its future in the British aircraft industry, due to rumours that Her Majesty's Government are determined to reduce, if not eliminate, their shareholding—that is, 69½ per cent.—in the company on the ground that the Hiller Corporation and Rohr Corporation, both American firms, are bidding to secure the manufacturing facilities of the factory, the former to build helicopters and the latter to make cowlings for jet engines.
The 7,000 workers at Shorts are wondering if a Labour Government are prepared to hand over a semi-public enterprise firm to private enterprise, extending the already high investment of American capital in Britain—which, according to an Answer given by the President of the Board of Trade on 3rd November last, totals about 1,650 non-financial companies resident in this country, owned or controlled by American firms, with book-value assets totalling nearly £2,000 million. Whilst United States investment here is quite concentrated, United Kingdom investment in the United States is widely based, and 80 per cent, is in minority holdings in firms under United States control.
There is not enough time in an Adjournment debate to refer to the very wide field of industry and commerce where American tentacles run quite deep. In computers, agricultural machinery, tractors and petroleum the United States stake in our industry is said to be 40 per cent, or more. For razors and blades, the United States have bearded most of the British market. There have been increasing United States developments in the film and processing markets.
Millions of British women are supported by bras produced by American firms in the United Kingdom, squeezed into shape by foundation garments, and made even more beautiful by a wide range of cosmetics produced by American


subsidiaries here. Breakfast foods, biscuits, processed foods, washing-up detergents, office machinery, engineering, oil, cars, electronics, tabulators, chemicals, drugs, natural gas, aluminium, banks and services, publishing, advertising and cinemas—these and many other commercial, manufacturing and industrial concerns are increasingly under American control here.
Many of us have been alarmed in recent days by reading of the intention of the Americans to cut their investments in Europe by, according to one report, 35 per cent., which could have a very serious effect on our industry, and on our film industry in particular. We have in the Industrial Reorganisation Corporation a Government body investing money in some industries and so introducing a safeguard.
Another aspect of concern is in the field of trade union relations, where many American controlled firms are reluctant to recognise our trade unions. I need hardly remind the Minister of Roberts-Arundel, of Stockport, which was the subject of an Adjournment debate not long ago, and there is the other situation which faced workers in the Kodak firm, where trade unions were not recognised. Although the Minister of Labour said that it is Government policy to inform U.S. firms of the traditions and practices of our industry, and although pay and conditions at many United States-controlled firms are beyond reproach, the principle that workers have a right to be organised is basic to our society. Although in the Adjournment debate on 6th December last the Joint Parliamentary Secretary to the Ministry of Labour claimed that no conclusions about American industrial relations should be drawn from the Roberts-Arundel case, he did call it a "sad and squalid episode".
But others have also expressed concern about the foreign investment in our firms. John Grigg, in The Guardian on 4th January last, said:
At last British opinion is becoming alive to the threat"—
meaning the take-over of key European industries:
but without steady leadership or adequate information.
I am therefore asking the Board of Trade to seek information through an inquiry into this aspect.
A recent book called "Le Défi Améri-cain" by Jean Jacques Servan-Schreiber describes the economic struggle between Europe and America as
The first great war fought without arms or armour.
And John Grigg comments that unless the major modern industries of Europe not yet taken over can be kept under European control, Europe will lose its inventive brains and higher technical skills to the New World, and will become little more than a provincial production line for American industry, and a playground for tourists.
A weekend conference was recently held at Ditchley, near Oxford where leaders of industry and Government from several countries discussed the problems raised by the invasion of great international corporations, mainly American. At that conference, Americans, British, French and others from technology, banking, giant industries and commerce as well as representatives of the Treasury, the Ministry of Technology and the Foreign Office, discussed these matters. Overseas investment is being checked by the Americans themselves, but we should not check the flow of such capital. We need to look at the position as others I have mentioned have done to ensure that the results are to our mutual advantage economically, industrially and in labour relations.
I conclude by thanking the Minister for her courtesy in being present to answer the points I have made. I ask her to consider several questions which arise. Will the Minister reconsider her hon. Friend's reply to a Parliamentary Question I put some weeks ago when I asked whether the Government would cause an inquiry to be made into the effects of American investment in British industry? I suggest that such an inquiry should include among other aspects the extent and range of foreign, particularly American, investment, control, financial effects, labour relations and employment prospects of its workers.
Will the Government consider the desirability of maintaining a majority of British directors on the boards of companies resulting from such investments, and seek assurances that such firms will not initiate any action to impair either the home or overseas operations of the management of such companies in their relations with the Government, labour,


British shareholders and the public as is the case in the agreement between the Minister of Technology and the Chrysler Corporation of a year ago? In other words, can we have action to ensure that our interests are safeguarded in firms under American and foreign control here as my right hon. Friend the Prime Minister insisted when he spoke from the benches opposite in 1961? When we welcome foreign investment in our development areas and elsewhere such an inquiry can be helpful to us and our visiting investors.

11.47 p.m.

The Parliamentary Secretary to the Board of Trade (Mrs. Gwyneth Dun-woody): I am grateful to my hon. Friend the Member for Newark (Mr. Bishop) for the thoughtful and provoking speech he has made on this subject. I am glad that he made the point clearly that he is not opposed to foreign investment here as a matter of principle. As he said, it creates new employment especially in the development areas where we are particularly concerned to bring in new firms. It helps also with the redeployment of workers from the older and declining industries.
This is not the only advantage which foreign investment brings us, for it brings foreign currency. By producing goods previously imported it also helps to reduce our import bill and to introduce new techniques of industrial management. American firms have an excellent record as exporters. In 1965, for example, American subsidiaries accounted for about 7 per cent, of the total net assets of all United Kingdom companies and for 13 or 14 per cent, of our total exports. If we could add to that export achievement the imports which have been saved as a result of the new production set up here—not to mention the immediate benefit to the reserves of the initial inflow of funds—I think we would find that American investment has made a very substantial contribution to our balance of payments.
This as my hon. Friend pointed out, this is not a simple matter of black and white. We realise that there are dangers as well as advantages in foreign investment. That is why, for example, we look at cases involving the take over of major firms on their merits. In doing this, we already take care of many of the points

which are worrying my hon. Friend. For example, he asks us to consider the desirability of maintaining a majority of British directors on the boards of foreign-controlled companies, but, as he himself has said this evening, this is precisely one of the undertakings we obtained when Chrysler extended its interests in Rootes last year.
My hon. Friend has also asked whether, in cases of this sort, we should not seek assurances that the firms will not reduce their operations overseas. Again, to give the same example, although it is not the only one, we sought and obtained an undertaking from Chrysler that it would plan a progressive increase in the exports of Rootes products, without restriction, to all practicable markets.
Therefore, at what point do my hon. Friend and I disagree? My hon. Friend asks us to consider attaching conditions of this sort to all foreign investment. We do not think that it is necessary. By and large, as I have said, it is clear that this investment operates in our economic interest. It makes much more sense to continue, as we already do, to look at the cases which really matter and where we believe that issues of this sort may really be important.
My hon. Friend asks if we can have legislation to ensure that our interests in these matters are safeguarded. We already have this legislation, both in the Exchange Control Act and in the monopolies legislation. The latter, which applies to any form of amalgamation, whether it arises from inward investment or is a transaction between British companies, will apply only in the larger type of case, but the former is general in its coverage.
My hon. Friend has referred to a few particular cases. He particularly mentioned the Roberts-Arundel case. The House does not need to be reminded of the deplorable industrial relations situation which arose in that firm. My hon. Friend the Joint Parliamentary Secretary to the Ministry of Labour gave a full statement of the Government's view of the matter in an adjournment debate on 6th December last. However, I think that we must remember that Roberts-Arundel was very far from typical of American-controlled firms in this country. Difficulties do arise sometimes—perhaps most often over the recognition of trade unions


—but the same sorts of difficulties sometimes arise in British firms as well. I do not think that it would be wise to take any special measures to try to deal with the industrial relations problems of American-controlled firms in isolation. Rather, we should hope that these problems, like our other industrial relations difficulties, will be eased by whatever action the Government decide to take after the Royal Commission on Trade Unions and Employers' Associations has reported.
My hon. Friend expressed uneasiness about the future of Ford of Britain. I should perhaps remind the House of what Ford is doing for Britain. Its exports from the United Kingdom approach £200 million a year, and it has just announced a campaign to increase exports to £225 million in 1968,including a major effort to increase sales in the U.S. itself. Ford has in recent years undertaken a massive programme of capital spending in the United Kingdom, not only on new productive capacity, but on design and research facilities. The establishment of Ford of Europe means that the company is thinking in terms of Europe as a single market, and seeks to organise its activities in Europe as efficiently as possible. We should welcome this outlook and development.
As my hon. Friend has mentioned, the Government have received assurances that the establishment of Ford of Europe does not mean any alteration of the undertakings given by Ford in 1961, when Ford of Britain became a wholly-owned subsidiary of Ford, United States, about its future expansion plans, the ploughing back of its profits, and its employment policies. I do not think that this is the time to doubt the usefulness of this company to our economy and I hope that the assurances given by the company will set at rest the fears that my hon. Friend has expressed.
Finally, my hon. Friend asks the Government to have an inquiry made into the effects of American investment. It will be clear from what I have said that in those really major cases where there might be detriment to the national interest—and these are very few—we consider very carefully the effect that the investment will have. This is the essence of the policy, to which I have referred, of considering major cases on

their merits. But I agree that general studies of the effects of investment made in this country by foreign companies are also valuable. Private studies have been made from time to time, but I think that we still lack enough hard information. Because of this, the Board of Trade has set in train a thoroughgoing research study into the economic effects of foreign direct investment in this country. This will take some time to conduct but will provide a valuable addition to our existing knowledge of this complex subject.
To sum up, we have the powers; we examine the really major cases with care, and we are trying to add to our information in general. We already have very much in mind such considerations as my hon. Friend has referred to. I hope he will rest assured that we are really very much in agreement.

Mr. Bishop: Before my hon. Friend resumes her seat, may I thank her for the consideration she has given to my comments and may I remind her of the great urgency of any steps taken in this matter?

Mrs. Dunwoody: I am sure that we are very anxious that this survey should be carried out in detail, but we will obviously bear my hon. Friend's views very much in mind.

11.55 p.m.

Mr. Albert Booth: May I ask my hon. Friend for an assurance that while the survey is being conducted, some account will be taken of the fact that the dividends made from American investment in this country become an invisible export to us and an invisible import to America? If we are to consider the facts put before us tonight as to the advantages of American investment, we should have this particular disadvantage investigated, as we are a country who rely very much on our ability to manufacture.

Mrs. Dunwoody: As I said, we are looking at all aspects of this matter. Although we are aware of the immediate advantages, we are also aware of some of the facts which could be long-term disadvantages. These will also be taken into account.

Question put and agreed to.

Adjourned accordingly at four minutes to Twelve o'clock.